What can motivate a man to lose USD 7,000,000,000 in a year?

News of a single rogue trader, Jerome Kerviel defrauding the largest bank in France, Societe Generale of a massive US 7 billion dollars has been all over the newspaper headlines in recent weeks. I find it quite amazing how a single person, not even a star trader but just junior trader, can manage to chalk out such a massive loss in just a short span of over a year. Most surprisingly, is the fact that he had managed to evade all detection despite holding such humongous positions on the European equity derivatives! The sum of money vaporised by his acts are more than what many people can earn over multiple lifetimes! I'm more surprised at the revelations about the motivation behind his behavior than anything else. What sort of success or notoriety was he chasing after?

Was he trying to make lots of money and profit from his fraudulent deals? Yes, and maybe not too. Apparently, as compared to his peers, he was less well paid than them, earning only €100,000 including his bonus, which amount to peanuts in banking terms. By taking these huge bets, he was trying earn money for the bank in return for expectation of a fatter bonus! But then again, money was not his only form of motivation.

Having moved from the bank's back and middle office to the front office, he was a relative nobody with a pressing need to prove himself. The trades were part of his ambition to succeed in the business and impress his bosses, and to lead them to recognize his “financial genius”. In other words, he was chasing after success for his esteem needs of self respect, and recognition from other people. This comes to prove that money doesn't really make the world go round. Success can mean different things to different people.

This brings to us an important lesson to be learnt. In our search for success it is good to never stop trying and persevering, but however the means we utilize must be honest. Getting to success is important but reaching it the proper way is equally important. Only success gained through integrity can truly be yours!

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