The Bregman Leadership Podcast
Episode 67

Alexis Stenfors

A Barometer of Fear

What do you do when you know you’ve made a big mistake? Alexis Stenfors mismarked his trading books, resulting in a $100 million error, and was labeled a rogue traitor. His upcoming book, A Barometer of Fear: An Insider’s Account of Rogue Trading and the Greatest Banking Scandal in History, details his experience. On this special episode, we discuss the fallout of this mistake and his journey to rebuild his life. Discover when to disobey your boss, a recipe for gaining perspective on conflict, and how to find the courage to face your mistakes.


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Book: A Barometer of Fear: An Insider’s Account of Rogue Trading and the Greatest Banking Scandal in History
Bio: Dr. Alexis Stenfors spent 15 years as a foreign exchange and interest rate derivatives trader at HSBC, Citi, Crédit Agricole and Merrill Lynch. In 2009, he found himself at the centre of a ‘mismarking’ scandal that would eventually result in him being described as one of the ‘world’s most infamous rogue traders’. He received a prohibition order by the FSA in March 2010 for mismarking during January and February 2009. The result of the FSA investigation concluded by prohibiting him from trading for a period of five years and the publication of a Final Notice, which does not include a finding that he acted dishonestly. The prohibition order was revoked by the FCA on 21 May 2015. Merrill Lynch were subsequently fined €2.75m by the Irish Financial Regulator for, amongst other things, failing to supervise Alexis and failing to manage his risk limits effectively. He is currently Senior Lecturer in Economics and Finance at Portsmouth Business School. Recent academic assignments include Teaching Fellow (SOAS, University of London), Adjunct Professor (Washington University in St. Louis) and Researcher within the EU FP 7 research project on Financialisation, Economy, Society and Sustainable Development (University of Leeds).



Peter: Welcome to the Bregman Leadership podcast. I’m Peter Bregman your host and CEO of Bregman Partners. This podcast is part of my mission to help you get massive traction on the things that matter most.

We have with us today an interesting guest, a different kind of guest. I’ve been more interested recently in bringing people who have real life experiences with some of the challenges that we face as leaders and our next guest is one of those people. His name is Alexis Stenfors. He was a trader for 15 years. He then got involved in a series of trades that ended up losing Merrill Lynch $456 million dollars. He was labeled a rogue trader. This was seven, eight, nine years ago. You may have heard about him or read about him in the newspaper. He then did a PhD. He’s now an academic. That’s his profession but he has an unusual past and has had a lot of time to kind of think about this.

What we’re going to talk with Alexis about is how you make a mistake like that and how you follow a certain path, that you later see to regret and how you can get caught up in something that you never would have imagined doing and yet your responsible for it. How you come back from that and the emotional courage that it takes, to show up the next day and the next day and the next year and a decade later, with colleagues who know that you have a label, that you may not consider fits you so well any more.

So we’re going to discuss all of this. We’re fortunate enough to have Alexis with us today. Alexis thank you for agreeing to come on the show and thank you for coming to the Bregman Leadership podcast.

Alexis: Thank you very much for wanting me. Thank you.

Peter: Alexis, give us a brief summary of what happened?

Alexis: This was in February 2009, just after Bank of America bought Merrill Lynch. I mis-marked my trading books and went on holiday, and realized … This was immediately after the weekend, that this was very serious, what I had done. I called my boss and said … My books, my trading books are mis-marked.

Peter: Explain for people who may not know, what does it mean to mis-mark your trading books?

Alexis: Books of value … They were overvalued, in my opinion, by $100 million dollars.

Peter: So you had made some trades and you wrote down they’re worth $100 million dollars more than they were actually worth?

Alexis: Exactly. Exactly. I called my boss and admitted this … What I had done. He said to me, “Well, it’s very serious. This could go all the way up to financial regulator.”

I said, “I’m sorry”, and I apologized.

Then he said, “Enjoy the holiday. See you in two weeks.”

At that moment I realized that this is something very, very serious. Not only the amount, the $100 million, but I realized that I would never go back to banking again. I was investigated. I flew back. I contacted a lawyer, and then only a few days after I came back to London, the New York Times called up, and asked, “Is this true? This rumor that you have miss marked your books?” Everything was still going on inside a bank.

I replied it’s a misunderstanding. To me, the whole scenario was much more complicated than simply you mis-marked or you don’t mis-mark. The whole scenario was very complicated. I went again to speak to my lawyer. The next day, there was a big article in the New York Times connecting me with the take over of Merrill Lynch by Bank of America, linked to a pretty big bonus scandal, in the U.S., that you might have heard about.

Really, from then on it started. I got labeled a rogue trader. This was published in a number of newspapers and T.V. In the end the bank lost $456 million dollars.

Peter: How did the $100 million go to $456 million?

Alexis: I don’t know.

Peter: Right. But it did.

Alexis: In reality, this was in the middle of a crisis, and my trading books were enormous. So closing a trading book rapidly, in liquid markets that you can’t trade, it’s going to cost a lot of money.

Peter: Right.

Alexis: I’m shocked by the large amount myself, but I’m not totally surprised.

Peter: Right, because you had to close out the whole book, and in order to do that, you had to sell things at a loss.

Alexis: Right. Yes.

Peter: Bring us, if you would Alexis, to the moment that you made the decision, “I’m going to mark up my books $100 million more than they should be.” The reality is that we’re all faced with these kinds of decisions, and very rarely are they as big as your decision. It’s unusual that you’re dealing with a $100 million dollar choice, but we might be dealing with much smaller choices. They could be anything as small as taking something from the office closet, all the way up to, $100 million dollar mis-mark on a trade. That doesn’t mean you’re a bad person or that we’re bad people but it means we make a poor decision in the moment. What I’m curious about is, what allowed you, what enabled you, what brought you to make that decision, that ultimately we would both agree is a poor decision?

Alexis: I’ve asked myself that for seven and a half years as well. I’ve been asked this question. When did it start? It was about six weeks before holiday. It took about six weeks. I was a trader for 15 years, and the moment I can’t recall, it started a lot earlier … The whole feeling that I got … I was so detached from reality, in terms of how much [inaudible 00:06:48]. It was phenomenal. I was in bad physical shape, mentally I was a wreck. Everything in my life, sort of work wise, was going downhill. I wish I could give an easy answer and say, I did this to make money. That wasn’t the case. This was during the early parts of 2009, and there was no incentive for me to try to show that I had made money, because it was a whole year ahead. It didn’t make any sense. The main reason that I was desperate to go away, to get out of the whole scenario of trading … In my opinion, had become very ugly.

I should have acted differently. Of course I should have told my boss. I should have told everybody. I should have informed. I should have done something else, but instead, I sort of just continued, until I had a chance to go away, and realized, hang on a minute, this is completely, completely wrong.

Peter: Was it a big decision of saying, okay, I’m going to mis-mark my books by $100 million or were they a million little small decisions ? Were you mis-marking your books just a little bit? Were you walking down a path and you didn’t realize how far you would go, until you had gotten there? Or was it one major choice?

Alexis: No. It’s definitely a million or a billion tiny, tiny decisions during this period. I think, most people would say $100 million is a lot of money, I think so too. The odd thing is, at that moment in time, in early 2009, for me, in the world that I was working in, $100 million wasn’t a lot.

Peter: It was numbers on a spread sheet.

Alexis: For me, for me. After I had spent 15 years in this market, trading trillions of billions, $100 million wasn’t that much. That is the absurd thing of everything. I had completely lost track of what is $100 million. What is a billion? It doesn’t really matter. I think that was … That is in a way, a scary thing, that I had completely lost touch with reality during this period.

Peter: So you were trading in billions of dollars?

Alexis: Yes. Yes. Yes.

Peter: So from a perspective of that, the mis-mark, didn’t seem like such a big deal in that moment? It felt like, you knew that it was wrong, but it didn’t feel like a catastrophe wrong? It probably felt like something you could recover from?

Alexis: Yeah. Yes. The target … What I was supposed to make as revenue during this year, wasn’t in the hundred of millions of dollars as well. The amount I traded everyday in foreign exchange and the [inaudible 00:09:58] markets, the [inaudible 00:10:00] and amounts were in many, many, many billions per day. So …

Peter: Were you worried about what you were going to make for the year?

Alexis: Not at that time. Not really worried, but I felt that it was impossible. It was impossible because there was no market. The banks were in bad shape. Very, very few banks wanted to lend to each other or trade with each other. Most people were exhausted. Not only normal people but all the traders in the dealing group were exhausted. It was the atmosphere was not nice. I didn’t have time to worry. The market was to busy. It was too volatile. It wasn’t really time to say, what will I do in a years time? Or in six months time? It was more a minute, or a second. You had a second or a minute to reflect. I think the moment when I had … When I was able to go away, was when I had one or two days to reflect.

Peter: That’s what shifted your perspective? You were away from work, you had a couple of days to reflect … Bring me to that moment. The moment where you come to this realization that you probably made a very, very big mistake.

Alexis: I was in India, in a tent, I remember. Our kids were six and eight at the time.

Peter: Isn’t that where all great realizations should happen? In India, in a tent?

Alexis: Maybe. Maybe it was India. I hadn’t been to India before. I’ve been to Asia many times, but never to India. I think … Maybe it was that. I said to my wife, if I call my boss, it’s going to be the end of my banking career. I hadn’t told here. I knew it. She said, it’s the right thing to do. I explained to her, this is what I’ve done, and if I tell my boss, this is the end of my career. She said, it’s the right thing to do.

Peter: So up until that moment, you were completely alone in this. Meaning you had no confidant around. You had no support system around the challenges you were facing around trading or anything?

Alexis: No, that’s right. I didn’t talk about this with other people … None of my friends, my family, or my colleagues.

Peter: Right. Was that phone call a difficult phone call to make?

Alexis: Yes and no. I think, in a way, for me, it was a very important phone call. It was the most important phone call in my life. When I hung up, and I knew that this is … I will never, ever go back again … It also felt very clear somehow. Somehow, even though I had done something extremely terrible, and I knew that things could get awful, I didn’t know how awful, but I knew it was downhill … It somehow felt that, this is the right thing to do, and I feel okay. I think that this is something that very few people, that I’ve spoken to, understand. They normally think, you must have felt awful afterwards.

No. I felt awful up until that moment. Immediately, when I talked to my boss and said this is what I’ve done. This is a mistake. This is … I apologize. This is wrong. I felt okay. Naturally, I have had guilt since then, for seven and a half years, but in terms of sort of feeling uneasy about it? No.

Peter: It makes sense. The unease has so much to do with the secret and also, the possibility of what might happen. Once you come out with that, and with the support of your wife, which feels huge, that there’s a certain surrender, it seems like, to whatever might happen. There’s nothing else you could be doing … You’ve made the decisions. At this point, it seems like … I don’t want to put words in your mouth but as I’m looking at you and listening to you … It seems like, at that point, you’ve done everything that you can do and you’ve finally done the right thing. You can’t control anything else that happens. Am I reflecting this back correctly?

Alexis: That’s right. It was impossible to control, say the media storm afterwards. I couldn’t control that. I couldn’t control how the bank investigated me.

Peter: Right.

Alexis: I couldn’t control what they … What kind of information they gave to the regulator. I couldn’t control my neighbors … What they thought about me.

Peter: Right.

Alexis: I could control, exactly, myself. I knew exactly what I’d done. I knew exactly how much guilt I felt. I couldn’t do anything more than that.

Peter: There’s something that feels very important actually, about being in a tent in India at this point. It seems like when you’re in the midst of the place … The environment, the context, your life, your apartment, the money you were spending … It’s very hard in that moment to say, I’m going to make an about face. I’m going to turn around. I’m going to contradict all of this stuff. I’m going to give myself up. When you’re in a tent in India, and that stuff is farther away, it seems like, you’re in a completely different environment and context, and from that place it becomes easier to say, that thing that was happening back in London … I need to change that. I’m curious as about whether that resonates?

Alexis: I think that is exactly it. It’s been very difficult to explain, say to my friends and my ex-colleagues. It’s exactly that way for me. I turned the sheets that day. For me, I could sort of think about myself as a third person. I was this person that had done this or worked in a trading room for 15 years … That was one part of me. I’ve never seen myself. Whatever I had done until that moment was … I could see myself from the outside. How could I do this? I have to find out. How do other people see me? That is probably how I should see myself as well. I can learn from that. It was a long process of course, and I’m still working on it. How do I look back on that period?

Peter: It’s powerful support to take regular vacations. Right? I mean to really get perspective, or to not … People I know, who are observant, Jews that are observant of the sabbath and they really completely stop working on Saturday, or people who regularly take retreats, and they go away for some period … To create space between your daily life and yourself … To create space between who you are as a person and everything that you’re doing and the environment that you’re in, feels like a critical lesson of this.

Alexis: Yes. Yes. I think it’s also linked to sort of my … [inaudible 00:17:39]. I must have spent two years with a psychotherapist discussing these things. I think one lesson , or one thought that I had, was also … It was very linked to a previous experience. Previously, I had asked for a holiday when our first daughter was born. I worked for a different bank and my boss said, “You can’t go, because we have to set trade markets. You can’t go to the hospital when you’re wife gives birth.” I ignored him. I said, forget that, I’m going to do exactly how I think. I did that and everything went fine for the family, however, my relationship with my boss deteriorated.

Then I had a new boss, a new bank, and my father was very ill. He was dying. I asked, can I go back and see my dying father? He said no, who’s going to look after your trading book? In this case, perhaps because of the previous experience, I obeyed. I stayed. I didn’t go home, and my father passed away. So after that moment, I would never sort of forgive my boss, because … Of course I wouldn’t not forgive myself. Why did I actually do this?

So the whole idea about, do you have to follow the order of your boss all the time? I think that’s also very important. I think, I made the right decision the first time, the wrong decision the second time. In this case, I think I made the right decision the third time. It wasn’t the right decision for the bankers at home, for many reasons it was the wrong decision. I should have told somebody earlier, but it also depends very much on who you trust. That is key. Who do you trust in your organization?

Peter: Right, and also a lesson for those of us who are bosses, to be trustworthy.

Alexis: Yes.

Peter: Let’s come to present day, because you’re still faced with this label of rogue trader. You still have the history of what you did, and yet you have new relationships to build, and you’re in a new profession. Here I am talking to you about this. It doesn’t just go away. I’m curious about, the courage that it takes to show up after something like that … Either directly after it, or even in the crisis, but after the crisis … To have that label, and you have your colleagues and you have your friends … I’m curious about what you do to support yourself? Not financially, but as a person, in the face of a label, that I’m sure does not go away, and in a new life that you are trying to build.

Alexis: I think, personally … Because I love finance and economics, it’s something that I’ve always loved to do. When I started to do my PhD after the rogue trading scandal, it was sort of going back to what I really loved. Academia, economics, finance … It was just a different way of looking at similar things. Still, in a way, looking at exactly the same things, as I did when I was a trader. It’s just that my perspective is very, very different. Round up trading, which is the most short term thinking you can think of. Academia is the other extreme, where you can reflect. You have time to think. You form your relationships, but I’m still sort of involved in that sense … In the same area …

Even though, can you compare an trader with an academic? Perhaps not, but because of the research that I do, because of the courses that I teach, I can still relate back. I think I am constantly reminded of this episode. I haven’t become a gardener for instance. I could have become something completely different. I could’ve tried to forget everything. Because I still work with similar things, I have to … I think about this every day. I think it’s just a matter of, everyday, being a little bit more comfortable in talking about it with people and not be upset when I’m called a rogue trader or when I look at people and I can see that they have read about me, but they don’t want to reveal that they know this about me, or they look me up on Google, etc …

These sort of things … It’s difficult. I don’t know if you can teach that to somebody. It’s just that you know that you are known for something really bad, and how do you … How do I confront people? You can’t bring it up every single time. Sometimes, you have to. Then you have to be open about it. Then normally it’s fine. If people hear the honest, long story, then most people are fine with it.

Peter: What you do for yourself, physically, emotionally, psychologically to buffer yourself from the reputation that you acquired early on in your career?

Alexis: I have tried different methods. First thing I did, was not to speak to media for seven years, okay? I thought, if I say something, the media will change the story and it will look different. So I decided that. I changed that this spring. I gave my first interview ever. During this time, I got so many different reactions. I’ve been … Somebody told me, I would put a bullet through your head. Some are very, very aggressive and how do you deal with that? Well, just be nice to people. I think that’s the lesson I have.

It’s very, very difficult. I can see, quite often, they know who I am. They expect me, quite often, because of this scandal and because it’s been in the media, many people think that this is something … The story is owned by everybody, so I somehow have an obligation to tell everything … That I don’t have a private life. I think here, is I have learned to handle that in a better way. To give something, always, if somebody asks, but not give everything, because I can’t … I’m not an ocean where everyone can say, if you want to learn about rogue trading, whether it’s good or bad, you go ask Alexis.

It hurts a lot because I do have a normal life as well. It was a very short period of my life, and I can’t let that take over everything.

Peter: Most of us aren’t trading in the billions or trillions that you were trading in but again, most of us have done things in our lives that we regret. Most of us, however small, however large, have done things that maybe nobody knows about. Maybe some people know about, but that we wish we had done differently. Any advice you have about moving on? You’ve been speaking about that a little bit now already, but any advice you have for people from all of the work you’ve done, over the last seven to eight years, that could be helpful to listeners?

Alexis: I think that one aspect, the moral aspect about what I have done, or the e-moral aspect, is to think about … Or remember … There is a difference between what is morally right in society, what is morally right in a company, what is legally right, and what is your own moral? I think you need to, all of us, should really think carefully about that, because if you work in a large organization … It doesn’t have to be a financial institution, or in a dealing group … You’re still faced with decisions, quite often, that you think, well, the company wants to do this, or my boss wants me to do that … Then you think, is this really the right thing to do? I know it’s legal, maybe, but maybe it is morally wrong. Here, I think we need to think more often about this. Stand up and don’t be afraid of saying, hang on a minute. Yes, I can see that this makes sense from a company’s perspective, or that this is still legal, however, it is the wrong thing to do. This is not only for leaders, this is also for employees. It’s very easy just to follow rules, and conventions, norms, and not question them. I think that is something we all are responsible for.

Peter: Thank you. Alexis Stenfors, you have been awesome to share this with us and to open up your story. I know that it’s not always pleasant and before our interview, when I said, how should I introduce you, you said something that is actually sticking with me now, which is, well look, we just have to say the truth. I was labeled a rogue trader. I think that’s such a testament to where you were seven or eight years ago and where you are now, and the advice that you just shared. You show up, you show up fully, you tell the truth, and you live with the consequences. I appreciate hearing that from you. Thank you so much for being on the Bregman Leadership Podcast.

Alexis: Thank you so much for having me. Thank you.

Peter: If you enjoyed this episode of the Bregman Leadership Podcast, please subscribe and leave a review on iTunes. For more information about the Bregman Leadership Intensive, as well as access to my articles, videos, and podcasts, visit Thank you to Clare Marshall for producing this episode, and to Brian Wood, who created our music. Thanks for listening and stay tuned for the next great conversation.


  1. Anat kedem says:

    Thank you for this, so inspiring. To spotlight this issue, of making a huge mistake , taking ownership and rising from it are rarely looked at from a leadership perspective. Lots of insights, such an impressive man. Thank you

  2. Sumi Verma says:

    Thank you Peter and Alexis for the podcast. I am inspired by Alexis’ struggle and as Peter said, the way he shows up fully. He kept following his passion and many students will get to learn from him, not only the technical skills but also the life skills. I really hope all is well with his family.
    Cheers for the podcast!

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