Bad Paper

Morgan Stanley is the latest investment firm to book significant losses due to the activities of a rogue trader. The firm revealed that its London office had suspended a trader that attempted to hide losses of $120 million.

According to a story by Tom Bawden in the online edition of The Times, the employee, identified in the article as Matt Piper, was under investigation for what Morgan Stanley referred to as a “$120 million negative adjustment to marks previously taken in a trader’s book that did not comply with the firm’s policies”. The trade reportedly involved credit derivatives.