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'Drunken' Broker Sent Oil to 8-Month High in 2009: Report

Thursday, 27 Sep 2012
1:56 PM E
By: James Burgess
On June 30, 2009, oil mysteriously jumped by
more than $1.50 a barrel during the night, to reach its highest price in
eight months, the kind of swing that is caused by a major geopolitical

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The amazing, true cause of this price spike has now been released by a Financial Services Authority investigation (FSA).

Although not authorized to invest company cash in trades, Steve Perkins, a long standing, senior broker at PVM Oil Futures, had managed to spend $520 million on oil futures contracts throughout the night, the FSA said.

the morning of the 30th, an admin clerk called Perkins to ask why he
had bought 7 million barrels of crude during the night. Perkins had no
recollection of the transactions, and it turned out that he had made the
trades during a “drunken blackout," according to the FSA.

By the time PVM realized the transactions had not been authorized by a client, they had incurred losses of $9,763,252.


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the hours of 1:22 a.m. and 3:41 a.m., Perkins gradually bought 69
percent of the global market, while driving prices up from $71.40 to
$73.05, by bidding higher each time.

At 6:30 a.m., presumably
sobering up and realizing what he’d done, he sent a message to his
managing director claiming an unwell relative meant he would not be able
to make it into work.

Following an official investigation
Perkins admitted to having a drink problem, had his trading license
revoked for five years, and was given a fine of £72,000 ($116,878).

FSA has said that they will re-approve his license after the five-year
period, if he has recovered from his drinking problem, although they
warned that,Mr Perkins poses an extreme risk to the market when drunk.

Added: Sep-27-2012 Occurred On: Sep-27-2012
By: dcmfox
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Tags: drunken, broker, sent, oil, 8, month, high, 2009
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