Less than 5 percent of unauthorized financial trading cases may be getting reported, said Toshihide Iguchi, whose trading losses led to the 1995 shutdown of Daiwa Bank Holdings Inc.'s U.S. operations.
Allowing traders to "walk away with a clean slate" instead of firing them for losses would reduce their incentives to engage in unauthorized trades, the now 63-year-old native of Kobe, who confessed to amassing $1.1 billion of losses in 1995, said in a recent interview in Hong Kong.
Financial institutions including Barings, Daiwa, Societe Generale and JPMorgan Chase & Co. have been hit by rogue trading since 1995. The magnitude of losses has grown from Barings trader Nick Leeson's $1.4 billion to the $6.8 billion blamed on Societe Generale trader Jerome Kerviel and Bruno Iksil's $6.2 billion losses at JPMorgan.
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.