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Really Dumb FX Trader + Decimal Comma Error + 10x Confusion Over Pay = $920,000 JPM Lawsuit
This would ordinarily qualify for the weekly piece of Friday humor, if only it wasn't too real. Bloomberg reports that everyone's favorite Federal Reserve overseer - JPMorgan Chase - is being sued by a trader who says he accepted a contract from the investment bank because a typographical error made him believe he would be paid 10 times what was actually offered. "Kai Herbert, a Switzerland-based currency trader, is suing JPMorgan for about 580,000 pounds ($920,000), his lawyers said at a trial in London this week. The original contract said Herbert’s annual pay would be 24 million rand ($3.1 million). JPMorgan blamed the mistake on a typographical error and said the figure should have been 2.4 million rand, according to court documents." Ok, so the guy is an idiot and somehow never understood what he was getting paid until after he looked at the contract. What people really want to know is if he pulled an Alex Hope and spent more than his entire post-typo paycheck on a bottle of champagne at Zurich's douchiest night club. In other news, bankers everywhere are trying to track down their employment contracts to see if they are "owed" far more than they are getting due to confusion between decimal and '000s commas.
“That must have been the moment your heart sank,” Judge Henry Globe said at the trial this week, referring to when Herbert discovered the mistake. Herbert resigned from UBS AG (UBSN) in June 2010 following the offer from JPMorgan to relocate to Johannesburg. Herbert didn’t report for work after discovering the discrepancy and JPMorgan rescinded the employment offer in December 2010.
In retrospect, it seems that heatmap momentum chasing junkies who use 500x leverage, and don't clarify terms of their employment before being employed, are not in short supply.
He has been unemployed since, other than eight months at Credit Suisse Group AG (CSGN) where he was fired in a round of layoffs in November. Banks globally have cut about 196,000 jobs since the start of 2011, according to data compiled by Bloomberg.
For once, JPM actually makes sense:
“How can you possibly suggest that they would pay you so much money for an executive director level job?” Charles Ciumei, a lawyer for JPMorgan, asked during Herbert’s cross- examination. The bank said Herbert could have mitigated his lost earnings by taking the position at the New York-based bank.
At the end of the day, it appears that no $310K now is somehow better than no $3.1 million never, all to chase a bouncing ball. And people wonder why Wall Streeters are sometimes perceived as greedy idiots by the general population.
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Funny but what is "an Alex Pope"?
edit: Your article should read pulled an Alex HOPE, there is a young trader I know named Alex Pope who probably will be getting some phone calls from clients today hahahaha
The Liverpool nite club reveler
thank you. edit: original story changed, I can't edit out my original comment to acknowledge though.
That's why you never want to totally commit......ya gets locked in.
Kai Herbert must be a Madoff investor looking for new source of miracles.
JPM fat finger in the ass.
Now pay the man!
Oops!
This whole problem is exacerbted when US-based banks write figures for German-speaking publication. The comma in a German figure is the same as a decimal in an English figure, and vice versa. Also, the confusion about the German "Milliarden" is still a source of frequent misunderstanding.
I wonder if working with 12 zeros in everything has anything to do with the problem too. Trillions is the new billions it seems.
Bring back s'teenths!
He is the douche that spent 300k on a bottle of piss at Londons douchiest night club hahaha
Is JPM writing hit pieces on here now!?!
This blatant ad hominem on the trader -- and blaming a shift of one decimal place on a comma/point typo -- is weak in the extreme!
True. A non JPM-originated hit piece would be much more lenient with a guy who could have made a phone call upon seeing his contract discrepancy and asking if it is truly different than what was prearranged, instead of suing 2 years after the fact, and having worked at at least one other place again after the fact.
Because in your version of reality it appears traders only figure out what they are getting paid after getting their contract.
Judging from the article he did do something like "made a phone call upon seeing his contract discrepancy and asking if it is truly different" - after all, he didn't show up for work on the first day. The thing is, by then he had already given notice to his previous employee, possibly had even already incurred the costs of moving over.
The thing is, for somebody working in the industry, suing an investment bank is a guaranteed way of never again finding work in the industry, so he would not have immediatly sued since that would guarantee that his career would be dead.
I suspect the trader in question sued when he came to the conclusion that his future in the industry was irreversibly damaged in the chain of events following JPM's "mistake" and he might as well try and get some redress from them to bootstrap a new career.
I've worked for the industry as an IT freelancer (i.e contractor) and at least twice, when markets were tight, I've had the rate amount previously agreed with the agent be cut at last minute, after I had already given notice on the previous contract (or told them I wasn't renewing) and just before I got the new contract to sign.
I don't work for the industry anymore, so now I can publicly say just how big a bunch of shitfucks most of them are :)
As an opportunistic bastard with a gamblers mentality I too would've tried to take JPM to the cleaners if the Risk to Reward ratio was favourable. A contract's a contract! Hmmm, (Lost case+no job for x years+costs etc):(gross $3.1 million). Very low Expectancy too I suspect. Damn good trade if he wins... Better to be lucky than good.
Serial incompetency is still not an excuse. If an 'industry' can claim incompetency to mask criminal negligence then the entire regulatory structure is a joke.
"...then the entire regulatory structure is a joke."
well, isn't it?
No, it's a farce.
Wrapped in a comedy
Wrapped in bacon
Farted on, by Tyler, along with the meringue.
Wrapped in an Enigma chocolate covered
reminds me of Jeremy Irons as a grand Spanish Inquisitor in "Casanova":
"We're here to discover heresy and criminal licentiousness. If there's bacon involved, I dread to imagine the depths of depravity we'll find here in Venice."
And people wonder why Wall Streeters are sometimes perceived as greedy idiots by the general population.
WHAT did you say???
Greeding is fundamental.
this is funny......... banker dipshits
I think dipshits should be offended to be used in the same sentence with bankers.
Does this explain why silver is only $31 and change rather than $310 and change? They moved the decimal point over on this guy and then compensated by moving the decimal over on silver spot. Damn rulers of the universe JPM.
Yes, I'm expecting the G-men at the office door any minute now...
This is what happens when JPM demotes it's "fat-fingered" traders to the payroll dept. Now they've got fat-fingered pay errors.
I thought they'd need to print another $50trillion before they started lopping off zeroes.
The Phat Phinger trader revealed?
I don't think he's an idiot. If the contract says 24M, then that's what he should get paid.
It's JPM who are the idiots in this story for not proof-reading their contracts. tough luck.
JPM looks like the idiot to me. It's in the contract. Tought, titties, Mr. Dimon. You think they'd give him the break if the "typo" was the other way around?
didn't you know contracts writen up by the banks/brokers are merely a legal obligation for the counter parties, not for the above the law bank silly..
I've activated my account solely because of this news. That chap is an old classmate! Highly ambitious (much more than me tbf), confrontational and exremely materialistic, scholary effort below average (repeated last year & no university degree) and has been fighting in the currency trading trenches for 20 years. Haven't heard from the chap in years and now this. The way I see it, he knew of the mistake and pushed his luck. His laywers were the back-up plan. Shit plan tbf, no ways he'll win this as that salary is so out of whack. Doubt he'll convince the judge. I'll refrain from further comment as I fear his trigger happy lawyers.
As to this site: keep up the good fight. Keep it honest. Keep it real. Well done.
This is why the SI system (you know, the way engineers and scientists write numbers down) uses a SPACE to break digits into groups. i.e. 1 000 000.00
If some frenchman used a comma by mistake, as 1 000 000,00 --- there's still not a problem! It's also the system that brought us kilo, mega, giga, tera etc. instead of "mille" "million" "billion" "trillion" and other factors.
Of course, you wouldn't want to employ people who are numerically literate to work in finance!
Where is that MillionDollarBonus clown? Based upon his ramblings on Zero Hedge, I always thought that his decimal was in the wrong place.
Hey LoneStar.
Hey!
LOLOLOL!!!
I AM CHUMBADUMBA! LOLOLOL!!!
Mistake is an adequate defense to this.
Kinda Corzinesque.. Agree?
I don't care who the dude is I just hope JPM has to pay. You know they would not give you a break.
Maybe confused on this, but across the pond, isn't the practice of commas and decimals the opposite of the way its practiced here?
For example, here, a one thousand prints, "1,000.00", while across the pond it prints, "1.000,00"?
He should have known - the Morgue ain't gonna loose 10x face on any trade!
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