As a result, 1994 became a year of sharp increase in losses. Due to the pressure of huge losses, Nick Leeson lost the ability to analyze the market and was led by the market. The loss of account 88888 increased from 65438+20 million in early 0994 to 50 million in July. In order to get the money, Nick Leeson lied that SIMEX asked Bahrain Bank to provide a deposit for his clients. In fact, he found the source of the money and provided a deposit for himself. Initially, the Bank of England stipulated that it was illegal for other banks to remit more than 25% of their total funds overseas. However, the application of Bahrain Bank was acquiesced by the Bank of England. At that time, Thompson was a senior official in charge of the supervision of commercial banks. He said that some things might be "buried in piles of papers". Therefore, Nick Leeson can apply for a large amount of funds from the London headquarters without being asked.
In some gambling transactions during the period of 1994, Nick Leeson suffered a series of losses, because the telephone may be tapped. Although there are times to make money in trading, there are also more times to lose money.
Trading Risk 1994 12 Two months before the bankruptcy of Bahrain Bank, Li Sen was regarded as a hero by 250 employees of Bahrain Bank worldwide at the Bahrain Financial Achievement Conference held in new york. At that time, his boss Ron only cared about how much profit Li Sen could make to pay the dividend in February next year.
By 1995, Nick Leeson's loss had reached1600,000, leaving a deficit of 50 million in the account of 88888. When the head office inquired about this matter, Nick Leeson lied that there was an over-the-counter transaction with SLK, which owed money, and forged SLK's promise to repay 50 million pounds, so that Citibank received 50 million pounds through transfer. As early as the summer of 1993, Bahrain Credit Department decided to provide SLK with a limit of US$ 5 million, but Bahrain Company took the decision to cover up its mistakes, which gave Li Sen another month to breathe. Although someone wrote a memo about it, no one discussed it, and no one asked where the 50 million went and tried to cover it up.
199565438+1October 18, Kobe earthquake, Japan, the Nikkei index fluctuated greatly in the following days, and Nick Leeson made a lot of profits in the early stage. However, due to the large deficit in the past, it is impossible to pay off all of them. At that time, Nick Leeson obtained funds from London for investment at the rate of 6,543,800+million pounds per day. However, he made a fatal mistake in this investment. He bought a lot of Nikkei futures and shorted JGB government bonds. As a result, the index fell all the way, while JGB rose all the way. Although the headquarters was dissatisfied with the huge sum sent to Li Sen every day, it was delayed by Li Sen.
1In February, 1995, Li Sen tried to buy the Nikkei index and try to support the market by himself, but this effort failed completely, and the Nikkei stock price plummeted. On February 23rd, Li Sen brought a loss of 860 million pounds to Bahrain Bank, which led to the termination of the oldest Bahrain Bank in the world. (SIMEX also wrote to Bahrain Bank to inquire about account 88888, and was worried about the amount of funds needed to maintain account 88888. Although SIMEX obtained a huge margin from account 88888, SIMEX believed that Bahrain Bank paid the margin for its customers, but SIMEX stipulated that member companies should not provide funds for customers' trading margin. Although the superior also knew about it, he never carefully checked the account number 88888, and casually mistyped SIMEX, allowing Li Sen to prevaricate skillfully. )
The final stage was in the final stage of February 1995. Li Sen was busy trading and went to the bar after work to avoid the staff's questions. Since mid-February, Li Sen has absorbed more than 500 million pounds of financing, although the total share capital of Bahrain Bank is only over 470 million pounds.
The Bank of Bahrain in England went bankrupt (1994 Christmas, Nick Leeson wanted to run away and never return to Singapore, but he "loved her too much to admit that I had lost such a large sum of money, and I didn't want to scare her. On second thought, I realized that I couldn't stand her image of failure. Because in her eyes, I will succeed in everything, so I can't stand being a loser in her mind ").
Simon, the Singaporean boss of Nick Leeson, wants Li Sen to make money, which will help his reputation and consolidate his growing power. He wants to make the distribution of Bahrain Bank in Singapore independent. He controls the tiller and can't let anyone get ahead of him. So he asked me to get rid of the auditor and falsify the audit records. )
(Singapore released the bankruptcy report of Bahrain Bank on June 5438+1October 65438+July:
"... Bahrain Group provided many explanations to explain the deliberate evasion of inspection of account 88888. However, they can't accept their view that account 88888 is an unauthorized account, and they know nothing about it. Our view is that the management of Bahrain Group knew or should have known the existence of account 88888 and the losses caused by the trading activities under the account. …… The London Settlement Department of Bahrain Group knows and should know that the additional margin constitutes the classified account of the additional margin issued by Bahrain Bank to customers. However, the London settlement department of Bahrain Group claims that it has never used a simple one-page document of the margin preparation form to solve the problem of inconsistent balance funds ... In fact, the internal audit report found no new signs. From the beginning, Bahrain Group knew that Mr. Li Sen had a dual role. He is both the director of the front office and the director of the back office. The internal audit report is mainly used to re-examine this point. However, Bahrain Group still goes its own way. ..... At any stage, the senior management of Bahrain Group did not ask how and where Li Sen got 7.78 billion yen (50 million pounds) to complete this unauthorized payment ... Mr. Norris (CEO) and Mr. Barkis denied that they participated in any plan to downplay the significant impact of this matter or hinder the independent investigation of this matter. But their denial is unacceptable. ..... Looking back on this matter, one thing is possible. If Bahrain Group had acted in time before February 1995, they might have avoided bankruptcy. By the end of 1995 1, although heavy losses had been caused, these were only a quarter of the final losses. ..... If the managers of Bahrain Bank still don't know about account 88888 until the bankruptcy, it can only be said that they have been avoiding the facts. After the bank collapse, Mr. Norris, the senior director of Bahrain Group, thought that Mr. Li Sen's behavior had little influence on Bahrain Group, but it produced good returns and was not credible. Moreover, it seems to show that the speaker is ignorant of the market reality and therefore lacks credibility. "