If there is one takeaway from the FSA’s statement on Kweku Adoboli today it is that operations professionals in investment banks need to man-up and start seriously challenging front office salespeople and traders. Operations professionals are not just back office facilitators: they are there to challenge the front office and to provide an ‘appropriate and robust’ control environment,’ points the FSA. At UBS, the FSA says operations professionals were overly obsessed with efficiency and insufficiently obsessed with control. As a result, Kweku Adoboli lost $2.3bn through unauthorised trades and UBS has been fined £29.7m. It’s hard to conceive of a more definitive mandate for operations staff to become more interventionist.
Ominously, the FSA also suggests that because a lot of middle office staff at UBS aspired to front office roles, they were too keen to do traders’ bidding. The implication is that moves from the middle office to the front office are to be discouraged.
Separately, Bloomberg reports that Credit Suisse is cutting another 100 jobs in its equities and advisory businesses in London. The chart below, from JPMorgan bankers, suggests why this might be the case.
And finally, given the difficulties we understand people are having in securing interviews before Christmas, we’d like to point out that the Financial Ombudsman needs to hire 500 people in the next few weeks to deal with a backlog of complaints related to the mis-selling of PPI Insurance.
When Mr Adoboli made a $6m profit for the desk after breaking his risk limit, he was sent a congratulatory message by his supervisor. (BBC)
The “chicken nugget challenge” was something of a rite of passage at UBS. The record was 48 chicken nuggets. (The Times)
Kweku Adoboli took out payday loans and missed his grandmother’s funeral. (Telegraph)
Luigi de Vecchi, one of Europe’s leading bankers who worked for Credit Suisse in London, was set to return in an “important senior client coverage role” after leaving in March, but has instead become a faculty member at the Rome-based Libera Università Internazionale degli Studi Sociali Guido Carli. (Financial News)
Deutsche Bank wants to hire sales traders in Birmingham. (Financial News)
Ex-Nomura prop trading quants have founded two trading start-ups: CRS Capital Services and Quantrium Services. (Financial News)
Operational risk is becoming the new thing. (Financial Times)
Nassim Taleb eats like a caveman and goes to bed at 8pm. (Guardian)
Mathew Martoma, the man charged with insider trading at SAC Capital, was a new breed of geeky hire who fell foul of the company’s aggressive culture. (Dealbook)
There is a lot of compliance hiring in Singapore too. (Reuters)
Goldman Sachs as a socially responsible investment. (Fool)
Gordon Brown set up a think tank to improve the behaviour of bankers and one of its managers stole money from it. (The Sunday Times)
Xenia Tchoumitcheva makes euro-rave single celebrating her sexy beauty. (Business Insider)
Steve Cohen works 80 to 90-hour weeks, with a camera constantly trained on his face to shout commands at underlings. (Financial Times)
If your boss has had a baby this year, your bonus will be lower – especially if he has had a son. (Economist)