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|+ Roll of Honour, financial disasters edition
|-
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! Scandal !! Date !! Jurisdiction !! Estimated Loss !! Gatekeepers !! Firings !! Jail-Time
! Scandal !! Date !! Where!! Loss !! Reason !! Firings !! Jail-Time?
|-  
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|Barclays Programme Limit || 2022|| US || [https://uk.finance.yahoo.com/news/ftse-100-barclays-profits-us-trading-error-064914092.html £1.3bn]  || Internal Operations || None reported || No
|{{disaster roll - Post Office Horizon}}
|-  
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|LME Nickel Short Squeeze || 2022|| London || [https://internationalbanker.com/brokerage/the-nickel-short-squeeze-what-happened/ “Billions”] || LME || None reported ... yet || No
|{{disaster roll - Credit Suisse}}
|-
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|Evergrande || 2021|| China || [https://www.nytimes.com/2021/09/19/business/china-evergrande-debt-protests.html $300bn] || || Who knows? || No
|{{disaster roll - SVB memeplex}}
|-
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|Archegos || 2021|| US || $10bn || [[When variation margin attacks|UMR]]<br>Internal operations || 100+ across brokers plus several senior executives and one CEO || Eyes peeled, Mr Huang
|{{disaster roll - Frank}}
|-
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|Greensill || 2021|| UK || [https://www.nytimes.com/2021/03/28/business/greensill-capital-collapse.html $4.6bn] || ||
|{{disaster roll - FTX}}
|-
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|Citigroup v Brigade || 2021|| US || ||
|{{disaster roll - BarclaysMTN}}
|-
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|Liberty Steel || 2021|| UK || ||
|LME Nickel [[short squeeze]] || 2022|| London || [https://internationalbanker.com/brokerage/the-nickel-short-squeeze-what-happened/ “Billions”] || LME || None reported ... yet || No
|-  
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|Ozy Media || 2021|| || ||
|[[Evergrande]] || 2021|| China || [https://www.nytimes.com/2021/09/19/business/china-evergrande-debt-protests.html $300bn] || || Who knows? || No
|-
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|Nikola || 2020|| || ||
|[[Archegos]] || 2021|| US || [https://www.theguardian.com/business/2021/apr/27/nomura-and-ubs-latest-banks-to-reveal-impact-of-archegos-collapse $10bn+] || [[When variation margin attacks|UMR]]<br>Internal operations || 100+ across brokers plus several senior executives and one CEO || Eyes peeled, Mr Huang
|-  
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|Luckin Coffee || 2020|| || ||
|[[Greensill]] || 2021|| UK || [https://www.nytimes.com/2021/03/28/business/greensill-capital-collapse.html $4.6bn] || ||
|-
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|Wirecard || 2020|| Germany || ||
|[[Melvin Capital Management LP]] || 2021 || US || [https://www.thestreet.com/memestocks/gme/gamestop-stock-melvin-capital-defeated-by-the-apes $7bn] || Hubris detector failed || Everyone! The fund shut down shortlay after || Talk of regulators, outrageously, going after the [[outsider trader]]s, but nothing as yet.
|-
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|WeWork || 2019|| US || ||
|[[Citigroup v Brigade]] || 2021|| US || [https://www.ft.com/content/de433d55-5cea-4929-9954-c08e5b98f004 $500m] || Outsourcing, Operations, IT || Not reported but wouldn’t fancy being head of the team in Bangalore || No
|-
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|Carillion || 2018|| UK || ||
|Nikola || 2020|| US || [https://www.cnbc.com/2021/07/29/us-prosecutors-charge-trevor-milton-founder-of-electric-carmaker-nikola-with-three-counts-of-fraud.html About 80% share drop] || CEO misrep || Must have been plenty || CEO indicted on charges of securities fraud
|-  
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|Patisserie Valerie || 2018|| UK || ||
|[[WireCard|Wirecard]] || 2020|| Germany || [https://www.reuters.com/article/us-wirecard-accounts-idUSKBN23W176 $4bn] ||  CEO misrep || All of them || Three charged with fraud including CEO
|-
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|Abraaj || 2017|| Saudi Arabia || ||
|[[WeWork]] || 2019|| US || [https://therealdeal.com/2022/03/11/weworks-losses-narrow-but-are-still-huge/ $11bn over three years]|| CEO [[yogababble]] || Nothing to see here folks! Got a new venture to start up || ''Jail''? Dude hasn’t even been kicked off Marc Andreesen’s Xmas Card list.
|-
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|Carillion || 2018|| UK || [https://www.theguardian.com/business/2020/jan/15/carillion-collapse-two-years-on-government-has-learned-nothing#:~:text=The%20demise%20of%20Carillion%20was,sales%20of%20%C2%A35.2bn. £7bn] || Auditors || 3,000 jobs || No but litigation a-plenty
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|Patisserie Valerie || 2018|| UK || £94m || Auditors ||900 jobs || No but PWC fined 2.3m
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|Abraaj || 2017|| Saudi || $1bn || Fraud, Virtue signalling || Some, not clear how many. ||Naqvi extradited and charged in US, many many gatekeepers fined
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|Fyre festival || 2017|| US || ||
|Fyre festival || 2017|| US || ||
|-  
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|| 1MDB || 2016|| Malaysia and US co-production || ||
|{{disaster roll - tunabonds}}
|-
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|Mossack Fonseca || 2016|| Panama with help from the international community || ||
|{{disaster roll - 1MDB}}
|-
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|Theranos || 2016|| US || ||
|[[Mossack Fonseca]] || 2016|| Panama || ||
|-
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|Wells Fargo accounts fraud || 2016|| US || ||
|[[Theranos]] || 2016|| US || peak valuation 10bn || Fraud, delusion || everyone at the firm|| Founders in jail for hundreds of years.
|-
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|Volkswagen emissions 2015|| Germany and US || ||
|Wells Fargo accounts fraud || 2016|| US || $2.7bn in fines and civil suits || fraud, out-of-control rampant bad appledom ||Plenty || SEC civil suits vs two senior executives
|-
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|Autonomy || 2012|| UK and US || ||
|Volkswagen emissions || 2015|| Germany and US || ||
|-
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|Olympus || 2012|| || ||
| AIG || 2008 || US || US$61bn || Misunderstanding mortgages || Not reported || Some irritation that bonuses were still paid
|-
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|LIBOR || 2012|| UK || ||
|Olympus || 2012|| Asia || US$4.9 || Accounting shenanigans, fraud || 2700 jobs ||Kikugawa and Mori sentenced to 3 years in prison, 5 years suspended. Auditor sentenced to 2.5 years in prison, 4 years suspended. Olympus was fined 700 million yen ($7 million USD). In April 2014, six banks filed a civil suit against Olympus over the fraud, seeking an additional 28 billion yen in damages.
|-  
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|London Whale || 2012|| UK || ||
|{{disaster roll - LIBOR}}
|-
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|Kweku Abodoli || 2011|| UK || ||
|London Whale || 2012|| UK || £6.2b || Rogue trader || Bruno Iskill was fired; an external lawfirm did a deep dive but unclear anyone else was directly whacked ||No
|-
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|Jérôme Kerviel || 2008|| UK || ||
|Kweku Abodoli || 2011|| UK || $4.5bn|| Rogue trader|| Abodoli and his line management ||Abodoli
|-
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|Bernie Madoff || 2008|| US || ||
|Jérôme Kerviel || 2008|| UK || $6.7bn || Rogue trader || Kerviel and his line management||Kerviel
|-
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|Amaranth || 2007|| US || ||
|[[Bernie Madoff]] || 2008|| US || US$65bn || Fraud/Ponzi || Whole firm, many subsidiaries and feeders || Madoff imprisoned. Several implicated enablers topped themselves.
|-
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|Tyco || 2002|| US || ||
|Amaranth || 2007|| US || US$9.2 || Hubris, Markets misbehaving || Whole firm || Charges settled on payment of 750,000 fine.
|-
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|Parmalat || 2003|| Italy || ||
|Tyco || 2002|| US || US$3bn || Accounting shenanigans || Unclear || Kozlowski did a stretch.
|-
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|Freddie Mac || 2003|| US || ||
|Parmalat || 2003|| Italy || EUR14bn|| Accounting shenanigans || ||Lots of settlements, fines and red faces
|-
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|Global Crossing || 2002|| US || ||
|Freddie Mac and Fannie Mae || 2008|| US || US$14.9bn || Failure to understand the concentrated risk of subprime home loans
|-  
|| No it was everyone else’s fault ||No it was everyone else’s fault
|WorldCom || 2002|| US || ||
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|-
|Global Crossing || 2002|| US || US$47bn if you believed the company0146s valuations || accounting shenanigans || Whole firm ||Gary Winnick and other ex-executives settled lawsuits filed by investors and former employees accusing the executives of committing securities fraud by using improper accounting to inflate the company's revenue
|Enron || 2001|| US || ||
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|-  
|WorldCom || 2002|| US || US$11bn|| Accounting shenanigans || Whole firm ||Ebbers convicted of fraud, conspiracy, and filing false documents with regulators and sentenced to 25 years.
|Long Term Capital Management || 1998|| US || ||
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|-
|[[Enron]] || 2001|| US || US$63.4bn || Accounting shenanigans, hubris, mismanagement || Whole firm, plus Arthur Anderson collapsed, which was nice, oh and the Sarbanes Oxley Act || Skilling, Lay and Fastow jailed, for fraud, money laundering, insider trading, and conspiracy among other things.
|Yasuo Hamanaka || 1996|| UK || ||
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|-
|{{disaster roll - LTCM}}
|Savings and Loan || 1995|| US || ||
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|-
|Yasuo Hamanaka || 1996|| Asia || US$1.8bn || Rogue Trader || Fired||Hamanaka convicted on four counts of forgery and fraud and sentenced to eight years in jail. Sumitomo paid fines of US$150 million to CFTC and US$8 million to the SIB to settle charges of copper price manipulations.
|Nick Leeson || 1992|| UK Singapore || ||
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|Nick Leeson || 1992|| UK Singapore || US$1.4|| Rogue trader || Whole firm || Leeson jailed.
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|[[Lehman]]  || 2008 || Worldwide || US$613bn|| Bankruptcy|| Hundreds of thousands || Noone.
|}
|}

Latest revision as of 17:57, 27 May 2024

Roll of Honour, financial disasters edition
Scandal Date Where Loss Reason Firings Jail-Time?
Post Office Horizon IT scandal UK Unjustified prosecution and conviction of hundreds of subpostmasters across the UK Unaccountability, groupthink, astonishing collective amnesia, widespread incompetence, stupidity. Conviction, imprisonment, suicide and bankruptcy of hundreds of perfectly innocent and quite nice people. Loss of public honours (CBE). No firings yet: many candidates for defenestration jumped before they could be fired. Excoriating public humiliation in front of public enquiry. Increasingly likely some criminal prosecutions may follow.
Credit Suisse Switzerland Gradual decline into entropy with a 92% decline in share price since 2015. Hubris, widespread incompetence, stupidity, spying, uselessness. Billions and billions over a series of avoidable cockups. Like the old man in Monty Python and the Holy Grail, “I’m not dead. I think I’m going for a walk. I feel happy.” Market (to SNB): “Isn’t there anything you can do?” It is not, yet, a crime to make a series of howling cockups[1] over a credulity-defying period any more than it is a crime to not read an AT1 prospectus. Reputations damaged for ever, but alas no porridge, however richly deserved it may seem.
Silicon Valley Bank memeplex 2023 US $80bn or more Dopey bank management, regulator asleep at switch, Peter Thiel panicking Bank insolvent. Bondholders and shareholders wiped out. Other banks levied. Triggered other moral panics such as First National, Signature bank and others (poor old lucky Credit Suisse) None yet. Lots of arguments about the presence or absence of moral hazard. Moral panic more like.
Frank 2023 US $175m Fraud, unfeasible gullibility Javice got fired. Surely more to come Not yet clear
FTX/Sam Bankman-Fried 2022 US, Bahamas $32bn (so far) so some claims that everything has now been recovered and returned to its rightful owner Hubris, stupidity, fraud Fired: Gary Wang, Caroline Ellison, SBF.
Bankruptcies: Alameda, Genesis, Blockfi.
Suspensions of trading: Gemini
Reported Losses: Crypto.com, Tiger Global Management, the Ontario Teachers' Pension Plan, SoftBank Group, BlackRock, Lightspeed Venture Partners, Temasek, and Sequoia Capital reported losses of $1bn
Charged with wire fraud, conspiracy to commit securities fraud, money laundering, conspiracy to defraud the U.S., violation of campaign finance laws.
Barclays MTN Programme Limit 2022 US £1.3bn Internal Operations None reported but you have to fear for those poor folk in ops. I beg your pardon? What poor folk in ops? Oh, Right. No-one goes to jail for forgetting to monitor a programme limit.
LME Nickel short squeeze 2022 London “Billions” LME None reported ... yet No
Evergrande 2021 China $300bn Who knows? No
Archegos 2021 US $10bn+ UMR
Internal operations
100+ across brokers plus several senior executives and one CEO Eyes peeled, Mr Huang
Greensill 2021 UK $4.6bn
Melvin Capital Management LP 2021 US $7bn Hubris detector failed Everyone! The fund shut down shortlay after Talk of regulators, outrageously, going after the outsider traders, but nothing as yet.
Citigroup v Brigade 2021 US $500m Outsourcing, Operations, IT Not reported but wouldn’t fancy being head of the team in Bangalore No
Nikola 2020 US About 80% share drop CEO misrep Must have been plenty CEO indicted on charges of securities fraud
Wirecard 2020 Germany $4bn CEO misrep All of them Three charged with fraud including CEO
WeWork 2019 US $11bn over three years CEO yogababble Nothing to see here folks! Got a new venture to start up Jail? Dude hasn’t even been kicked off Marc Andreesen’s Xmas Card list.
Carillion 2018 UK £7bn Auditors 3,000 jobs No but litigation a-plenty
Patisserie Valerie 2018 UK £94m Auditors 900 jobs No but PWC fined 2.3m
Abraaj 2017 Saudi $1bn Fraud, Virtue signalling Some, not clear how many. Naqvi extradited and charged in US, many many gatekeepers fined
Fyre festival 2017 US
Mozambique tuna bonds 2012-2016 Mozambique, Russia and Switzerland £1.5-2bn Credit Suisse fined £350m and required to forgive its loans ouch Fraud, corruption, money laundering Plenty, including three Credit Suisse bankers and the minister in Mozambique Three Credit Suisse bankers done on money laundering charges
1MDB 2016 Malaysia, but tentacles stretching all over the world: USA, Saudi Arabia, Singapore, Switzerland, China Somewhere between $4.5bn and $8bn Colossal fraud, corruption, money laundering and hip-hop Hell yeah. Prime Ministers, Goldman Sachs Partners, and one dude — Jho Low — on the lam in rural china You betcha: Australia, Hong Kong, Indonesia, Luxembourg, Seychelles, Singapore, Switzerland, UAE, UK and US are all actively pursuing action. The two Goldman partners pled or were found guilty; one sentenced to 10 years, one awaiting sentencing. Malaysian PM and wife convicted and sentenced to 10+ years with money laundering. If anyone catches Jho Low he’s for the high jump too.
Mossack Fonseca 2016 Panama
Theranos 2016 US peak valuation 10bn Fraud, delusion everyone at the firm Founders in jail for hundreds of years.
Wells Fargo accounts fraud 2016 US $2.7bn in fines and civil suits fraud, out-of-control rampant bad appledom Plenty SEC civil suits vs two senior executives
Volkswagen emissions 2015 Germany and US
AIG 2008 US US$61bn Misunderstanding mortgages Not reported Some irritation that bonuses were still paid
Olympus 2012 Asia US$4.9 Accounting shenanigans, fraud 2700 jobs Kikugawa and Mori sentenced to 3 years in prison, 5 years suspended. Auditor sentenced to 2.5 years in prison, 4 years suspended. Olympus was fined 700 million yen ($7 million USD). In April 2014, six banks filed a civil suit against Olympus over the fraud, seeking an additional 28 billion yen in damages.
LIBOR rigging 2009 Worldwide “If your mortgage or car-loan was pinned to Libor then perhaps you were disadvantaged by the manipulation of the rate. But it is also possible that you benefited from it.” To date, no one has been able to prove any loss. Bad apples Lots of firings of mid-level traders and rate submitters. Strange absence of exits from the Executive Suite, though you could say it contributed to Bob Diamond’s defenestration Tom Hayes and Carlo Palombo were among 37 City traders prosecuted for manipulating benchmarks Libor and Euribor. Both men spent time in prison before being released in 2021. Matt Connolly and Gavin Black were convicted in the US then their convictions were overturned in 2023.
London Whale 2012 UK £6.2b Rogue trader Bruno Iskill was fired; an external lawfirm did a deep dive but unclear anyone else was directly whacked No
Kweku Abodoli 2011 UK $4.5bn Rogue trader Abodoli and his line management Abodoli
Jérôme Kerviel 2008 UK $6.7bn Rogue trader Kerviel and his line management Kerviel
Bernie Madoff 2008 US US$65bn Fraud/Ponzi Whole firm, many subsidiaries and feeders Madoff imprisoned. Several implicated enablers topped themselves.
Amaranth 2007 US US$9.2 Hubris, Markets misbehaving Whole firm Charges settled on payment of 750,000 fine.
Tyco 2002 US US$3bn Accounting shenanigans Unclear Kozlowski did a stretch.
Parmalat 2003 Italy EUR14bn Accounting shenanigans Lots of settlements, fines and red faces
Freddie Mac and Fannie Mae 2008 US US$14.9bn Failure to understand the concentrated risk of subprime home loans No it was everyone else’s fault No it was everyone else’s fault
Global Crossing 2002 US US$47bn if you believed the company0146s valuations accounting shenanigans Whole firm Gary Winnick and other ex-executives settled lawsuits filed by investors and former employees accusing the executives of committing securities fraud by using improper accounting to inflate the company's revenue
WorldCom 2002 US US$11bn Accounting shenanigans Whole firm Ebbers convicted of fraud, conspiracy, and filing false documents with regulators and sentenced to 25 years.
Enron 2001 US US$63.4bn Accounting shenanigans, hubris, mismanagement Whole firm, plus Arthur Anderson collapsed, which was nice, oh and the Sarbanes Oxley Act Skilling, Lay and Fastow jailed, for fraud, money laundering, insider trading, and conspiracy among other things.
LTCM 1998 US $3.6 bn bailout orchestrated by the Fed Black-Scholes option pricing model attacked them from nowhere Everyone out of a job, Master of the Universe-sized reputations (John Meriwether, Myron Scholes, Robert C. Merton) cut to ribbons No, though fourteen bank CEOs were locked in a room by the Federal Reserve for a weekend so that is something.
Yasuo Hamanaka 1996 Asia US$1.8bn Rogue Trader Fired Hamanaka convicted on four counts of forgery and fraud and sentenced to eight years in jail. Sumitomo paid fines of US$150 million to CFTC and US$8 million to the SIB to settle charges of copper price manipulations.
Nick Leeson 1992 UK Singapore US$1.4 Rogue trader Whole firm Leeson jailed.
Lehman 2008 Worldwide US$613bn Bankruptcy Hundreds of thousands Noone.
  1. except where the individual cockups were themselves criminal of course