Financial Market is a dream place for all the speculators and gold diggers. Despite all the rules and regulations there are still savvy combinations and dozens of tricky operations that make one person rich at the expense of others. Just as a famous Russian book character Ostap Bender who knew "approximately 400 relatively honest ways of taking money away from people".
Today even if you hide something eventually it will come out. There are too many ways of tracking the financial operations and other activity that might reveal your true intentions. But still who are those Doctors Evil who couldn't stop and wanted just get more and more.
I searched internet and can't say i found so many examples. Not because there are not so many of them but simply because banks
and financial institutions are pretty sensitive about it and are not so willing to share all the juicy details. So here are the stars who buried their careers:
and financial institutions are pretty sensitive about it and are not so willing to share all the juicy details. So here are the stars who buried their careers:
Hawkins is a Founder of Petro America Corporation that is based in Kansas City. He claimed his company was a petroleum giant but at the same time he was constantly accused of managing bond manipulations and money laundering. A devoted member of African-American Church he had his investors mostly from there.
His scheme was pretty classic. He made people believe that he had gold mines and oil wells full of future skyrocket returns and people believed him. He issued millions of shares that were immediately bought. The total fraud scheme was worth $10.2 mln is securities. Kansas City Business Journal reports it like this:
"Hawkins received almost $2 million in investor funds, using it to buy a Hummer, a Mercedes, 19 designer suits and a $5,700 fur coat. He also drew a $595,000 salary and rented a lakefront home in Kansas City, Kan. "
The trial is still being held and seems like Hawkins is facing a sentence between 21 and 28 years in federal prison. Poor guy, he will have to switch from his designer suits and fur coats to an orange robe.
2. Kweku Adoboli
Born in Ghana he got his education in England and was described as "British by culture, citizenry and fame". Former Swiss Bank UBS Trader couldn't stop gambling to make up for his unlucky trades and made the loss of $2bln in total. The fraud was reveiled in September 2011 and now Adoboli is serving his 7 year jail sentence. In March 2013 he attempted to appeal but the judge is still thinking whether to grant the permission.
His trick was based on the fact that ETF issues a confirmation on a transaction not right away but after some time. While the transaction is being processed the account still officially has the same amount of money. So after Adoboli made a payment his account still showed the same money and he could make some other payments as well. The bank system detected the fraud and reported that there was an unauthorized activity on the account but the bank management ignored it. And the price for that was $2bln in losses!
This was a really weired story that happened in 1990's. Young was a fund manager for Morgan Grenfell Asset Management. He made good profits on speculative trades on the unlisted stocks in the beginning of his career and later he kept maintaining high risks to stay on the same level of returns.
Fund regulations state that the fund can't have more than 10% of a company so in order to evade this rule Young created a scheme to trick the system. He created mirror holding companies that could buy the desired stocks as much as he wanted as well as numerous unlisted stocks that he was dreaming of. And according to the regulations fund owed 10% of those fake companies. Not suprisingly mirror holdings didn't forget to monthly transferre some cash to his personal accounts. Eventually the fraud was reveiled . But the story doesn't end here.
When the trial was set for his case, Young appeared in a dress and acted weired. On all other his trials he also showed up wearing a dress. Another creepy fact is that he tried to change his sex by castrating himself even though he was married and had a wife. This case attracted lots of public attention. Young was found guilty in all charges but the judge voided the verdict due to Young's insanity.
Fund regulations state that the fund can't have more than 10% of a company so in order to evade this rule Young created a scheme to trick the system. He created mirror holding companies that could buy the desired stocks as much as he wanted as well as numerous unlisted stocks that he was dreaming of. And according to the regulations fund owed 10% of those fake companies. Not suprisingly mirror holdings didn't forget to monthly transferre some cash to his personal accounts. Eventually the fraud was reveiled . But the story doesn't end here.
When the trial was set for his case, Young appeared in a dress and acted weired. On all other his trials he also showed up wearing a dress. Another creepy fact is that he tried to change his sex by castrating himself even though he was married and had a wife. This case attracted lots of public attention. Young was found guilty in all charges but the judge voided the verdict due to Young's insanity.
4. Nick Leeson
This is the best know case of trading fraud. Leeson was a general manager of the British oldest bank with 240 years history Barings. They had a branch in Singapore where Leeson was managing futures trades.
When his returns droped causing losses he decided to recover it by placing a short straddle in a risky stock. Unfortunately the same night there was an earthquake in Kobe whic caused the entire stock to collapse. After that Leeson got involved into some other risky trading but the total loss wiped out the last savings of the Barings Bank and caused its final collapse.
Leeson was put in a Singapore jail for 4 years. After he was released he wrote an autobiographic book "Rogue Trader" which then turned into a movie with Ewan McGregor starring.
This is the best know case of trading fraud. Leeson was a general manager of the British oldest bank with 240 years history Barings. They had a branch in Singapore where Leeson was managing futures trades.
When his returns droped causing losses he decided to recover it by placing a short straddle in a risky stock. Unfortunately the same night there was an earthquake in Kobe whic caused the entire stock to collapse. After that Leeson got involved into some other risky trading but the total loss wiped out the last savings of the Barings Bank and caused its final collapse.
Leeson was put in a Singapore jail for 4 years. After he was released he wrote an autobiographic book "Rogue Trader" which then turned into a movie with Ewan McGregor starring.
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