What Do You Do With A 'Drunken' Trader ?
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At least that's what happened over at Morgan Stanley.
On February 6th, 2008, London-based oils trader David Redmond, then 26, is said to have returned to the office from a 3-hour boozy lunch break and engaged in a frenzied bout of trading - in a 90 minute period in the early evening, Redmond traded, on average, once every 7.5 seconds!
Realising that he was in breach of his trading limits, Redmond then concealed his trading positions overnight by apparently transferring them onto an unknowing colleague's book. In doing so, he is said to have exposed Morgan Stanley to a possible loss of up to $10m. The next day, without informing the firm what he was doing, Redmond managed to trade his way out of the position and returned a small profit. The trader only admitted what happened when Morgan Stanley's internal controls picked up on it.
Morgan Stanley suspended Redmond, and subsequently fired him for gross misconduct. Redmond's behaviour is said to have been out of character, but, in banning him for 2 years, UK market regulator The Financial Services Authority (FSA) says that although the trader was not 'visibly drunk', his lunchtime activities did 'appear (to have) affected his behaviour on his return to the office'.
Redmond co-operated with the FSA investigation and is free to apply for reinstatement as an approved person in 2 years.
The City, of course, is no longer known as the boozy place it once was. But probably the best-known example of a drunken escapade was reported a few years back, when a London-based Citigroup analyst is said to have returned to the office after lunch somewhat tipsy, and is alleged to have jumped on his secretary's desk and urinated 'willy-nilly'. About the only thing he managed to hit, however, was himself. Obliging colleagues are said to have taken off the analyst's trousers and stuffed them into a microwave to dry. He was said to have been escorted off the premises by security staff, and later suspended. His current whereabouts is unknown.
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