Merrill Lynch confirms rogue trader has been suspended
In a move which is sure to send shock waves through the city, it has been confirmed that an American trader working for investment bank Merrill Lynch in London has been suspended after an enquiry into "trading irregularities". While we still await official confirmation regarding the extent of the "trading irregularities" there is a suggestion that losses could reach as high as £85 million. Merrill Lynch has just been taken over by Bank of America and this is obviously a bitter blow for the company's new owner at such an early stage.
It would appear that the transactions involved foreign currencies and substantial "bets" on the movement of various currencies around the world. The trader was apparently suspended last month and all regulators in the UK have been informed of the situation, although there is still an ongoing enquiry into how and why it happened. The trader involved has been talking to the press with a suggestion that the matter was "a misunderstanding" and he is co-operating fully with the internal investigation.
This is not the first substantial trading scandal to hit the city over the last 12 months as traders and investment companies become more and more desperate to make money in what is becoming one of the most difficult market climates in recent times.
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