Nick Leeson at Barings, Jerome Kerviel at Societe Generale, John Rusnak at Allied Irish Bank. And now 31 year-old Kweku Adoboli, who allegedly ran up $2.3bn in losses at UBS. These are the rogue traders who have bought banks to their knees. Each time the banks declare themselves to be innocent victims of a fraud.
But why do traders keep on committing apparently senseless crimes, with little benefit apart from higher bonuses and an enormous risk of ending up in prison? And why do banks, which should have learned the tricks of the traders, keep being deceived?
In this Penguin Special ebook, the FT's associate editor John Gapper unlocks the mystery by delving into the evolutionary risk-taking instincts of both humans and animals - from yellow-eyed junco sparrows in Arizona to bumble bees. He examines how banks encourage their traders to evade risk limits, and shows how rogue traders merely mimic the strategies used by their firms to seem more profitable than they really are.
A rogue is often an outsider who starts in a lowly role and gambles with a bank's money in a bid to become a star. Gapper traces patterns of behaviour and personality that could be used to catch them before disaster strikes. But do the banks really want to? And are the rogue traders just the symptoms of a financial system gone rogue?