Big gaps can form between what clients have and what they owe, and
Barings had strict trading limits and believed that it was diligently monitoring
all its traders to make sure they did not exceed their limits, but the
bank’s systems were not prepared for the level of fraud and misrepresentation
that Leeson committed, and Barings was not aware of the secret passageway
Leeson found to its crown jewels. In July 1992, shortly after being
assigned to Singapore and only a couple of days after Barings gained membership
on SIMEX, Leeson opened an 88888 Account, just like the one he
uncovered in Barings’ Indonesia branch.7 By 1993, just a year after his arrival,
Leeson began reporting extraordinary profits.