This may seem like a strange blog for an Australian Photographer, however in my checkered career I did a stint in the financial world in the City of London, including running hedge funds and as business development director for the European side of a New Zealand investment bank.

I learnt one thing during my association with the City there is little interest in clients the main myopic focus is on Fees and bonuses. This is why so many scandals are coming into the public domain; it’s all about making money in the short term then getting out. The LIBOR and Forex fixing by the banks using young traders, Nick Leeson (and his famous lucky Chinese 88888 account). This is not to mention some of the big US frauds, Madoff and Petters both multi-Billion Dollar frauds. The list of investors and feeder funds into Madoff is enormous including some of the biggest names in the banking and investment world with massive due diligence departments – just shows how greed can overrule Logic and management focus.

Scandals/ frauds are certainly coming thick and fast. There has been foreign exchange, precious metals, at least two rigging scandals about Libor(previously mentioned) and  now an investigation into whether the banks rigged the liquidity auctions back at the heart of the financial crisis itself.

The Serious Fraud Office is investigating the Bank of England’s crisis-era liquidity auctions  believed to relate to a £180bn funding scheme that was ended by the BoE in 2010.

In  September 2011, the Swiss bank UBS announced that it had lost over 2 billion dollars, as a result of unauthorized trading performed by Kweku Adoboli, a director of the bank’s Global Synthetic Equities Trading team in London.

On 24 September 2011, Oswald Grübel, the CEO of UBS, resigned “to assume responsibility for the recent unauthorized trading incident”, according to a memo to UBS staff.^[3][4] On 5 October Francois Gouws and Yassine Bouhara, the co-heads of Global Equities at UBS, also resigned.^[5] It later emerged that UBS had failed to act on a warning issued by its computer system about Adoboli’s trading.^[6][7][8]

As I mentioned they are coming thick and fast. All this naughtiness brings me to a culture that exists in many of the major financial centres, London, New York and others. The culture that exists in the great financial centres of the world is one of of hiring young people from major universities and elsewhere and allowing these youngsters to trade unsupervised in many cases billions of dollars. Youth will gamble so youth is hired and allowed to gamble the bank’s or fund’s assets. In reality these funds are not the bank’s or fund managers funds but the investors and until recently the account holders. This culture is one where the senior management know exactly what is happening and the bet is taken on youth. It the gamble goes wrong then youth is disowned in favor of management survival. If the the Kobe earthquake had not happened Nick Leeson may have been a hero – The bank knew exactly what was going on- ‘youth gambles’ and wise men(if all goes to plan) pick-up the profits.

Remember the arrogance of the ‘Flaming Ferraris’ five young City slickers, the son of Lord Archer among them, striding from a stretch limousine to whoop it up at their exclusive Christmas bash. These were the so-called ‘Flaming Ferraris’, the world’s most successful share traders – named after their favorite rum-and-Grand Marnier cocktail. The five would, it was said, bet up to £3 billion a time on a deal, and then expected to share a £5 million bonus. Like many of these young trader’s with little real life experience and the arrogance of youth it ended in tears.

Neil Behrmann’s Trader Jack addresses the City financial youth culture in a great yarn told with a considerable amount of accuracy. It really is a good read and is based on a very real and dangerous City culture.

Trader Jack can be purchased via: Amazon  http://www.amazon.co.uk/Neil-Behrmann/e/B005HA9E3M:

Australian Photographer – Shane Aurousseau