'Brogue trader' blames bonuses

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The former trader, who served five years in jail, now runs a dry-cleaning and laundry business.

Financial-services fraud will continue as long as bonuses provide incentives to ignore limits, according to convicted currency trader John Rusnak, who lost $691m at a U.S. unit of Allied Irish Banks.

'As long as financial markets are set up in a way that they’re paying young men large bonuses to produce profits, there’s always going to be people pushing the edges,' Rusnak said in an interview with RTE Radio. 'I don’t see any significant change or reform of the financial markets.'

Bloomberg News reports that the 49-year-old also criticized bonuses for compliance staff, telling the Irish state-owned station there’s 'always a reason to look the other way' when incentive payments go to people monitoring and overseeing risk-takers as well.

Rusnak pleaded guilty in 2002 to defrauding AIB’s Allfirst Financial Inc. unit and was sentenced to seven-and-a-half years in prison. A year later, AIB sold the Baltimore-based unit to M&T Bank Corp. (MTB). The former trader, who served five years in jail, now runs a dry-cleaning and laundry business.

Hit the link below to access the complete Bloomberg News article:

Ex-AIB Rogue Trader Says Bonus Culture Encourages Fraud

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