Bad Apples or Bad Barrel Case Flashcards
What was Josh Jett’s story?
Josh Jett worked for Kidder Peabody. Auditors eventually discovered that he was using accounting loopholes and internal control flaws to make fictitious profits. When his actions were discovered he was fired and his bonus and accounts were frozen, GE had to take a $210 million write-off, and the SEC started an investigation.
What was Nick Lesson’s story?
Nick Lesson worked for Barings Bank. He had made a bad bet on the yen that resulted in a $1.4 billion loss for the bank, which eventually caused the bank to be brought down.
What was Kweku Adoboli’s story?
Kweku Adoboli worked for UBS. He was known for using his internal controls knowledge to use phantom trades to cover up his $2 billion in losses.
What was Tom Hayes’ story?
Tom Hayes worked for UBS. He made aggressive bets on interest rates.
What did UBS have to do because of a Wall Street Journal article?
They had to pay $1.5 billion in fines to the U.S. and other governments
What did UBS admit about their internal controls and processes?
That they made it easy to start rate rigging and for it not to be detected
What is the ethical dilemma in the Rogues - Bad Apples or Bad Barrels case?
Should steps be taken to change the atmosphere and the situation instead of just blaming it on rogue traders?
