YASUO Hamanaka was not best known for charisma. With his steel rimmed glasses and grey flannel suits, he was a generic senior Japanese salary man. Nor do non ferrous metals sound, on the face of it, the most glamorous of commodities. But his confidence and his power to move this market were unmatched. So, it turns out, was his colossal dishonesty.
We have had Nick Leeson, the trader who brought down Barings. Then came Toshihide Iguchi, a New York based dealer awaiting sentence. Now the league table of rogue traders is topped by a new name. Mr Hamanaka, one of the world's most feared and respected copper traders, has left the mighty global Sumitomo Corporation trading company with losses totalling £1.8 billion sterling. The Serious Fraud Office in London yesterday announced an urgent investigation into Sumitomo's affairs.
Just a few years ago, Mr Hamanaka was a business hero. The Sumitomo annual report of 1991 gave its star trader a double page spread of his own, complete with glossy portraits and adulatory profile.
He is quoted as saying that the pre-eminent position of Sumitomo Corporation in copper trading is attributable to "expertise in risk management". At this point, apparently, Mr Hamanaka had been carrying on his illegal trade, completely undetected, for five years.
In the world of copper trading Mr Hamanaka has long been a legend.
Once, a speculator in London became so frustrated with his financial skills that he punched out the window of the public gallery. Various nicknames accrued to Mr Hamanaka during his 26 year career at Sumitomo, only some of them printable "Mr Copper", "Hammer" (from his name, and the power he was said to command over prices), and "Mr Five Per Cent" (from the share of the copper market which he was believed to control).
Mr Hamanaka is said to have particularly prized this last tag, which was originally applied to a very different businessman the great American oil magnate Calouste Gulbenkian.
Mr Hamanaka's public utterances reinforce this sense of impregnable hubris. "There are various rumours and slanders against me," he told an interviewer in 1991 although I am getting used to them.
Sumitomo was founded in the early 17th century as a supplier of copper to Japan's shoguns. But in the postwar period it had fallen behind its competitors in the market for nonferrous metals.
Sumitomo had no copper mines of its own and thus no access to the raw material. According to employees in rival trading companies, Yasuo Hamanaka trumped them by coming up with a brilliant short cut Sumitomo could control the flow of metal through the market by investing in copper futures and options.
By the early 1990s the strategy had paid off handsomely. Sumitomo became the biggest copper trader in the world. But when the 1980s boom came to an end, nowhere was it felt more acutely than in Japan.
