Oil trader banned for hidden deals struck after boozy lunch

A former Morgan Stanley oil trader who hid from his bosses a potential $10m (£6.3m) loss on trades that were made under the influence of alcohol after a long lunch has been handed a two-year ban by the City watchdog.

David Redmond, a trader in the commodities team at Morgan Stanley, returned from a three-and-a-half hour lunch in February last year and put on a series of trades in the oil futures market that left the bank at risk of a $10m loss.

He then concealed this position through further deals with a colleague's accounts.

Mr Redmond in fact made a profit from the deals when he "traded out" and closed them the next day, but he was nonetheless sacked by his bank after they discovered his actions.

Yesterday, the Financial Services Authority banned Mr Redmond for two years from working for any regulated firm. However, the FSA indicated it would consider approving him again after that point.

"Traders must not seek to conceal their positions from their firms," said Margaret Cole, director of enforcement at the regulator.

"Mr Redmond's conduct showed a lack of honesty and integrity that falls short of the standards the FSA expects of approved persons."

Between Mr Redmond's return to his desk just before 5pm and 7.30pm, his deals left him net short 5,395 lots of the futures contracts - equivalent to 30 per cent of the UK market in that particular contract, but only about 4 per cent of the overall market. His position did not move prices.

Full story here: http://www.ft.com/cms/s/0/67654606-459e … ck_check=1