toddfearn.com

This is crazy.  The latest news is that the CEO resigned over the weekend and the CIO takes over as interim CEO. 

The straw that broke the camels back?  The $2.3 billion loss last week by rogue trader.

I don’t have all the inner details of what went on here, but there is one common theme I’ve seen over the years of working with IT for financial firms.  The real issue is that many of the internal IT systems within these big banks don’t speak to each other.

In this case, I would assume that the UBS risk systems that were in place did not integrate with the systems that the rogue trader was using.  My assumption: by the time the risk department picked it up probably via an insider tip on e-mail, it was just too late.

I had a quick conversation with Eric Best last week at a luncheon at the Strata conference in NYC.  He’s consulted with some CIOs at the largest wall street firms.

We spoke about IT and what is needed most within these firms.  It’s access to data, raw data.  Most developers in financial firms shelter data within applications or a database and don’t expose this data to outside systems.  This is dangerous.

A simple proposal to CIOs:  All data for all applications within the entire firm should be exposed, at a minimum, to internal applications via REST or well defined web services. 

And the next step, go external.