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Literally they go out of business. Best example is Barings Bank: "The bank collapsed in 1995 after suffering losses of £827 million (£1.6 billion today) result
by barkingcat 7y ago
Literally they go out of business. Best example is Barings Bank:
"The bank collapsed in 1995 after suffering losses of £827 million (£1.6 billion today) resulting from fraudulent investments, primarily in futures contracts, conducted by its employee Nick Leeson, working at its office in Singapore. "
https://en.wikipedia.org/wiki/Barings_Bank https://en.wikipedia.org/wiki/Barings_Bank
- zenmaster10665 7y agoNot quite the same situation, but your point is still valid. Leeson was hiding losses fraudulently in error accounts as a malicious internal actor. In these cases, clients are being extended credit they likely cannot underwrite, leaving RH exposed and liable to any losses theirselves.