Whereas, if the 'risk model' had failed for any other reason, there'd have been no consequences. What's to say their model was correct even on paper? Funnily, nobody would have said anything if the mistake had made money. So, caveat emptor!
This site is inaccessible on mobile browsers (or at least iPhone)<p>It "helpfully" redirects to the IEEE Spectrum mobile homepage. If you are making a mobile version of a site, <i>please</i> don't redirect blindly. I followed a link, I expect to go there.<p>EDIT: thankfully, the article was recent and a link to the mobile story shows up on the page we get redirected to.
According to their SEC filing, the source of the error was that they were using both percentages and decimals in the software, and someone thought that a decimal was a percentage. It's surprising how little your risk model does for you when you multiply it by 0.01.
"... an independent consultant with expertise in quantitative investment techniques who will review disclosures and enhance the role of compliance personnel."<p>I assume this is press-release-based and so pretty thin on actual information, but if someone told me they had a $242 million software error and the plan for the future was to "review disclosures" I would not be reassured.
There are no software errors, only programmer errors. The computer did exactly what it was told to do.<p>[Generated by HNCommentGenerator Vers. 2.04 2011-02-11 17:01:44 GMT]
While software risks should ideally not be included in part of those risks, investing has some inherent level of risk.<p>Once society finally grasps that, we'll hopefully be better off. Not condoning what these guys did by any means, but caveat emptor for sure.