25-year-old trader on £182k's tactics for manipulating colleagues
Things have not worked out well for Travis Klein. Aged only around 28, he will never work in trading again and has been afflicted with a £73k ($93k) fine from the UK's Financial Conduct Authority (FCA). It could have been worse, though. The FCA wanted to fine him £104k but was lenient when it became apparent that doing so would cause Klein some «serious financial hardship.»
Get Morning Coffee ☕ in your inbox. Sign up here.
Klein's crime was a spate of 426 "fictitious trades" over a 19-month period while he was working for Macquarie's London metals trading desk between 2020 and 2022. Given that Klein joined Macquarie's graduate program in 2017, aged circa 21, this would have made him around 25 years old when the trades were perpetrated. He earned £288k over those 19 feral months, which implies compensation of £182k a year.
Klein might still be earning that money if he hadn't panicked when Macquarie asked him to derisk his «freight book». The FCA says Macquarie «benched» Klein and asked him to take two weeks out of his positions to observe the market after he'd made big losses. Klein panicked. The market was too illiquid to exit his positions quickly. He pretended to de-risk with his 426 fictitious trades. In fact, he did no such thing.
All the best rogue traders, from Nick Leeson to Kweku Adoboli, know how to play the middle and back office. Leeson and Adoboli both booked fictitious trades and both used their own experiences of working behind the scenes to hide their tracks. Klein, however didn't come up through the middle office and instead seems to have relied entirely on a series of manipulative tactics to get around his colleagues in control functions.
The FCA's ruling details these tactics as follows:
Getting
Read more on efinancialcareers.com
