THE TELEGRAPH: PVM Oil Futures trader Steve Perkins bought 7m barrels of crude in late-night trading binge on his laptop, driving the oil price to an eight-month high.
It's probably not uncommon for City traders to wonder how they burnt so much cash during a drunken night on the town.
But Steve Perkins was left with a bigger black hole in his memory than most when his employer rang one morning to ask what he'd done with $520m of the oil trading firm's money.
It was 7.45am on June 30 last year when the senior, longstanding broker for PVM Oil Futures was contacted by an admin clerk querying why he'd bought 7m barrels of crude in the middle of the night.
The 34-year old broker at first claimed he had spent the night trading alongside a client. But the story began to fall apart when he refused to put the customer in touch with his desk for official approval of the trades.
By 10am it emerged that Mr Perkins had single-handedly moved the global price of oil to an eight-month high during a "drunken blackout". Prices leapt by more than $1.50 a barrel in under half an hour at around 2am – the kind of sharp swing caused by events of geo-political significance. Ten times the usual volume of futures contracts changed hands in just one hour.
By the time PVM realised the trades were not authorised and swiftly began to unwind the positions, losses of exactly $9,763,252 had stacked up.
The amount was almost equal to PVM Oil Futures' entire annual revenue of $12m and caused a $7.6m loss last year - shared by the senior brokers who are its only shareholders.
It swiftly emerged that Mr Perkins had been relieved of his position at PVM, but details of the bizarre incident have only just been made public after a Financial Services Authority investigation. >>> Rowena Mason, Energy Correspondent | Wednesday, June 30, 2010
THE TELEGRAPH: Steve Perkins, the oil trader banned by the UK financial regulator for illegally trading $520m in a drunken stupor, is about to resume his career as an energy broker in Switzerland.
The Daily Telegraph can reveal that Mr Perkins, who was fined £72,000 by the Financial Services Authority (FSA) on Tuesday, was in Geneva on Wednesday for talks about joining a commodity broker called Starsupply Renewables SA.
The revelation that Mr Perkins is once again poised to trade the global markets after single-handedly moving the oil price by $1.50 in the middle of the night will be deeply embarassing for the FSA.
The regulator said that "Mr Perkins poses an extreme risk to the market when drunk". However, it admitted last night that it knew he was planning to restart his career in Switzerland – only 24 hours after being banned for five years in the UK.
The FSA confirmed that it has notified the Swiss regulator, but admitted it was powerless to stop Mr Perkins from trading in Europe.
"The Swiss would have been made aware of this and it is up to them whether they continue giving him authorisation to work," a spokesman said.
Recommendations by the Basel Committee on Bank Supervision were meant to improve the co-ordination of cross-border financial monitoring, but this case is likely to raise concerns about whether European regulation is sufficiently joined up. >>> Rowena Mason | Thursday, July 01, 2010
