City confidential
- Reduce text size Decrease text size
- Increase text size Increase text size
- Print article Print
- Jump to comments Comment
- Share this article Share
- Email article to a friend Email
While City bonuses are now so high that they can adversely affect the rate of inflation, many seasoned traders still bemoan the ‘good old days’ before electronic trading systems had yet to sweep through the Square Mile. As one former trader recalls, “things were much more fun” when computers weren’t being used to scrutinise every deal.
However, maybe the good old days are not quite dead: the computer systems are not as all-seeing as might be supposed. In May 2007, BNP Paribas Private Bank became the first private bank to ever be fined by the UK Financial Services Authority for what it described as “weaknesses” in the bank’s anti-fraud controls.
According to the FSA, “a flaw” in the bank’s IT systems allowed a senior employee at the bank to siphon off a cool £1.4 million from a customer’s account. BNP Private Bank had alerted the FSA to the fraud, but was nevertheless fined £350,000.
If that’s what happens without strict controls, maybe the good old days weren’t so good after all.
