Rogue trader cost MF Global $142M
NEW YORK (AP) — A rogue trader at MF Global rang up $141.5 million (93.6 million) in losses on the broker’s account this week, the company said Thursday, costing the company almost a fifth of its market value.
The Bermuda-based broker said on Wednesday morning it discovered Evan Dooley, a trader at the company’s Memphis, Tennessee, branch, trading wheat contracts in amounts that exceeded how much he was allowed to trade.
MF Global fired Dooley and liquidated the wheat contracts, which led to a $141.5 million (93.6 million) loss.
An entry-order system that should have blocked the trades failed, the company said.
Dooley had bought a few thousand lots of wheat futures contracts on the Chicago Board of Trade, MF Global said.
The price of wheat has surged in the past month because of constraints to global supply and swelling demand from China. E-mail to a friend
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