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A $251 Million Typo

Posted by Zonk on from the that's-a-big-oops dept.

theodp writes "A Taiwan stock trader is jobless after a typo left her company looking at a paper loss of more than $12 million when what was supposed to have been a small order mistakenly resulted in a $251 million purchase. 'Something like this is difficult to explain to superiors,' a company exec explained."

11 of 415 comments (clear)

  1. Nice... by Anonymous Coward · · Score: 5, Interesting

    She gets fired, and they keep the stock as they expect to profit from it...
    Why is she getting fired and not trained?

    AXJZTOS

    1. Re:Nice... by h4rm0ny · · Score: 5, Insightful


      Great - you've just fired the one employee you know will always and forever more, triple check everything she ever does.

      --

      Aide-toi, le Ciel t'aidera - Jeanne D'Arc.
    2. Re:Nice... by OrangeSpyderMan · · Score: 5, Insightful

      "Why is she getting fired and not trained?"

      She's the scape goat - if she doesn't get fired one of the higher execs will. I work in a large bank and the answer to this problem is business processes. The "head honchos" don't want to get fired for putting place an IT system and a business process that allows a single individual to do this kind of thing by mistake, and so are firing her to save their bacon.

      --
      Try NetBSD... safe,straightforward,useful.
    3. Re:Nice... by OrangeSpyderMan · · Score: 5, Insightful

      tell me why firing her saves their asses? If I were the owner I'd fire them regardless..

      There are unspoken rules in this kind of thing. In my experience, the only risk of a high ranking exec losing his/her job over this is if there is someone at a similar or higher rank who had it in for them anyway.

      How does this work? Someone calls a meeting to explain they've just lost 300 million. In most cases they will all agree that the most important thing to do is to find who seems to be directly responsible and fire them, and once that is done, come up with an "Action Plan" to avoid it happening again. The Action Plan bit is where they fix the real issue, and they will then congratulate themselves on having addressed the issue promptly and efficiently. The only time the question of why "promptly and efficiently" didn't mean before it happened is if the implementation was the work of a single person or small group of people that could also be made into blame carriers. The higher up the ladder those people are, the less likely there's someone higher to point it out, and so often it's the shop floor worker who pushed the light green button and not the dark green one, when in fact the buttons should have been RED and GREEN. This kind of thing happens at all levels of hierarchy, but of becomes more obvious once you reach the levels that can "fire at whim".

      If the owners are stockholders, it's even simpler - they won't even care if you can present the bottom line performance in such a way that this doesn't even appear (it's probably a relatively small sum for such a place..) - or better still you can present the action plan to the stockholders in such a way as it will stop this kind of mistake and also make the company more reliable, efficient and therefore competitive and the stockholders won't even care who actually is responsible. SOX404, which has very much a pyramid of responsibilities for many things, including "operational risk control" (of which this is a case) may change this, but we'll have to wait and see. Right now all it's doing is costing companies a great deal of money, and is unfortunately too often being approached in a "cover your ass" manner, rather than as proper risk control.

      --
      Try NetBSD... safe,straightforward,useful.
    4. Re:Nice... by ISaidItOmega · · Score: 5, Funny
      You people are being way too harsh on this trader... haven't any of you ever suffered from a typo? I know I have. Last month when I was writing an e-mail to my girlfriend, instead of typing,

      "I miss you hunny and I can't wait to see you this weekend ;) ...",

      I typed,

      "Jesus Christ woman you have ruined my life and I've been cheating on you with your sister!!"

      ... I hate keyboards...

  2. She should take her employer to court. by thona · · Score: 5, Insightful

    What is this - dumpest investment bank ever? * They let a trader onto an unsecured system without proper training (unfamiliar with computer system). * The system is ocnfigured/programmed in such a way that there are no max trade orders, no security precautions, nothing at all in place. What is so hard to explain here? I was dump, I did not make sure my trader was property trained and the system we ordered lacked any fundamental security precautions. Poor trader - a dcase of a software/management fuckup and he has to pay.

  3. Just one dismissal?!? by Spoukie · · Score: 5, Insightful

    I've worked in market data systems for years. I can see how someone unfamiliar could flub an order. Inexperienced staff are typically be put on a rather short leash (ie. system madated spending limits and such). It would be a shame if she were the only person to lose her job over this. There are (or should be) a host of people responsible for making sure this sort of thing doesn't happen. Seems some of them should be sacked as well!

  4. Fubon? by fwc · · Score: 5, Funny
    Fubon has to be an acronym for *something*.... Anyone?

    Fouled up by one number, perhaps?

  5. Why company culture is important by amichalo · · Score: 5, Insightful

    This article exemplifies teh improtance of company culture.

    For several years I worked for a US bank with the highest possible bond rating. Though smaller (at the time) than the national banks we all think of today, this bank was well known for its culture of prudence and the quality of our lending.

    Why is this important? Because it rolled right over into the IT departments. From suppliers to product purchasing to in house software, everything was done very much "by the book" and we didn't care if we weren't doing things the latest and greatest because we wanted to do things right. And yes, our banking systems had limits on everything so a junior banker could never make a $1,000,000 loan by misplacing a decimal.

    It contrasted sharply with my stint in a dot-com where things were fast, furious, and being "by the book" was laughable. Cutting edge might have been cool then, but the bank I worked for is now one of the nations largest, and the dot-com is a dot-bomb.

    --
    I only came here to do two things; kick some ass, and drink some beer...looks like we're almost out of beer.
  6. Re:Bad Interface? by knipknap · · Score: 5, Insightful

    Are you sure you wish to continue [OK] [Cancel]

    Here's how I would have designed the application:

    Are you sure you wish to continue?
    [Cancel] [Spend $251,000,000]

  7. Re:sanity checking by QuestorTapes · · Score: 5, Insightful

    > The primary fault lies with the developer who failed to adeqautely validate input... Data
    > validation...includes sanity checking to make sure data are within reasonable ranges, and requiring
    > additional confirmation (ranging from "Whoa, dude! That much?" to supervisor approval) when input is outside that.

    Have to disagree. -If- developers in such organizations were designers and architects, I would agree, and I certainly agree that such checks are needed on core financial systems.

    However, confirmation and supervisor approval, and determining what is reasonable in terms of range checks is a business decision, not a coder decision. If software development in the business world was usually done right, then the developer would have the background and skills to do this. Typically, they don't even have the background to know to recommend such things.

    IMHO, this is why neither the trader nor the developer (probably; this case may not be like the typical one I described) should be held accountable. The people in charge of the decisions that led to this deficiency in the software -and- the business processes it supports should be held responsible and forced to fix the problem.