Chapter 3

Chapter 3

Questions to consider

1. Peter Gumble, European editor for Fortune magazine, comments, "Kerviel is a stunning example of a trader breaking the rules, but he's by no means alone. One of the dirty little secrets of trading floors around the world is that every so often, somebody is caught concealing a position and is quickly - and quietly - dismissed... [This] might be shocking for people unfamiliar with the macho, high-risk, high-reward culture of most trading floors, but consider this: the only way banks can tell who will turn into a good trader and who even the most junior traders to take aggressive positions. This leeway is supposed to be matched by careful controls, but clearly they aren't foolproof." What is your reaction to this statement by Mr. Gumble?

ANSWER : True, most of the companies nowadays have their own "dirty little secrets" of trading . And employees of the company conceal position quickly and quietly, and this is not good. companies must be aware and alert  to lessen or prevent any form of fraud.

2. What explanation can there be for the failure of SocGen's internal control system to detect Kerviel's transactions while Eurex detected many suspicious transactions?

ANSWER : SocGen became too confident. 

Discussion Questions

1. Do you think that Mike Lynn acted in a responsible manner? Why or why not?

ANSWER : True, He is responsible for he publicized the secrets of CISCO.

2. Do you think that Cisco and ISS were right to pull the plug on Lynn's presentation at the Black Hat conference? Why or why not?

ANSWER : No, for Lynn were about to reveal information to public. information that would reveal their dirt little secrets.

3. Outline a more reasonable approach toward communicating the flaw in the Cisco routers that would have a led to the problem being promptly addressed without string up animosity among the parties involved.

ANSWER :  "Software is vulnerable to a Denial of Service (DoS) and potentially an arbitrary code execution attack from a specifically crafted IPv6 packet."