What kind of risks does the given pose to the firm

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You oversee the risk of a large trading group that specializes in foreign exchange and fixed-income. You notice that over the course of several months, one of your traders has generated $200 million in losses in a 30-day period, well outside the trader's assigned risk limit. After some investigation, you find that the valuation engine used by the trading organization is out-of-date and has a tendency to underestimate the risk of the changes in certain market movements. Three days later the trader vanishes and you find that $10 million of his account is now missing. What kind of risks does this pose to the firm?

Reference no: EM13936508

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