Investment Banking (04:14)
Nick Leeson could deceive powerful figures in finance. In 1992, he began trading for Barings Bank on the SIMEX; his success caught the attention of John Gapper. Ian Loh traded against Leeson.
Barings Brothers (03:39)
Leeson worked for Barings Securities as the general manager and head of settlements; the company had few controls. In the 1990s, trading was the fashionable way to make money. In 1993, an internal bank memo warned about the dangers of the system.
SIMEX Trading Floor (04:03)
The markets fluctuated violently in 1992 and Barings Securities made a series of mistakes. Loh explains the trading floor process. Leeson hid a $60,000 loss in a secret account, claiming it was to protect a junior trader.
Trading Losses and Deception (03:56)
Barings Securities' profits were based on Leeson's deceit; he hid multi-million dollar losses. Leeson asked for funding in September 1992 and presented the bank with false clients; the bank sent over $60 million by January 1993.
Rogue Trading (03:46)
By January 1993, Leeson concealed over $35 million in losses. Alan Bloom explains why traders are required to take vacations. In April, Leeson secretly purchased hundreds of contracts; Dr. Nair explains dispositional greed.
Dispositional Greed (03:01)
Leeson's gamble resulted in a $250,000 profit but an error on Monday continued the loss/cover-up cycle. Experts reflect on Leeson's behavior.
False Success (04:25)
By September 1994, Leeson's initial SIMEX loss increased to over $320 million; Leeson practiced avoidance techniques. Barings Bank received an award for exchange success. Leeson turned to alcohol to cope with failure.
"Risk Free" Investments (03:34)
At the start of 1995, Barings Bank sent over $800 million to Leeson. If the bank had challenged the origins of profits, Leeson's deception would have been exposed.
Leeson Evades Questions (02:23)
In February 1995, auditors noticed a high debtors figure and bank officials went to Singapore. Leeson deflected unwanted attention, but Tony Railton was suspicious and alerted Barings Brothers.
Trade Fraud Exposed (04:14)
On February 23, 1995, rumors of Barings' troubles reached the trading floor of SIMEX. Leeson's deception was exposed; losses totaled $800 million.
Barings Brothers' Collapse (06:31)
Leeson fled the country and sent an apology fax from Kuala Lumpur; the news reported the collapse. ING purchased what was left of the Barings Name; Leeson was arrested and sent to prison.
Credits: Barings Bank (00:32)
Credits: Barings Bank
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