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William Pesek

Man Who Brought Down Barings Warns on China

Nick Leeson says regulators can't keep tabs on surging stocks.
Regulators can't keep up.

Regulators can't keep up.

Photographer: Dennis Pu/Getty Images

Twenty years after bringing down a major British bank, Nick Leeson is sounding alarm bells about China. Unless the country reforms its stock markets, he warns, it's only a matter of time until his earlier disaster repeats itself on a larger scale.

In 1995, Leeson was a 28 year-old master-of-the-universe wannabe running a trading desk in Singapore for Barings Bank. When markets turned against him, he tried to hide his losses with unauthorized trades -- trades that were enabled by the lax oversight on Singapore's then-underdeveloped exchanges. Eventually, Leeson's losses mushroomed to $1.4 billion, shaking world markets and toppling a 223-year-old bank that held an account for Queen Elizabeth and financed the Napoleonic Wars. (Leeson, for his part, ended up in jail, where he wrote a book about his experience called "Rogue Trader.")