Trader who moved global money markets now coming to terms with spectacular fall from grace Johnny Ruz' may have moved markets, but he existed on a knife edge of anxiety, writes Conor O'Clery, International Business Editor
Just before the scandal broke at Allfirst on February 6th, trader John Rusnak faced an agonising moment in his personal life. He had to tell his wife Linda what he had kept from her for five years, the fact that he had been accumulating and hiding massive losses and counterfeiting trades at the AIB-owned bank, and now faced prison. Her response was to tell him that if he didn't get straight, she would leave him. The currency dealer is now focused on rebuilding his marriage and coming to terms with the guilt that he feels over the fate of his suspended colleagues and over losing $691.2 million at the bank that gave him employment.
For the last year as his losses soared, he lived in a constant panic, drinking a lot, unable to sleep at night, causing strains on his marriage.
Now he tells friends he is just relieved to have it over. Those who know him well say it shows; a month ago he was haggard looking, but now that he is no longer burning up nervous energy at a furious rate he has put on 10 pounds and appears more relaxed.
It is a very different image from the one his colleagues were familiar with at the bank up to a month ago. There, as he admitted to friends, he was an affront. He was aggressive, refusing to keep regular hours, going to lunch and not coming back, driving off in his red Chevvy Tahoe to play golf when he felt like it. In his trading he pushed people around. Sometimes he would sit up late at home, trading with Asian markets on his laptop on which Allfirst had installed a Travel Bloomberg system a year and a half previously to allow him to trade anywhere, anytime. He has admitted he was consumed by how important he was. Of an estimated 300 people globally engaged in high-level foreign exchange trading, 100 were propriety dealers - allowed to gamble a bank's money - and of these Rusnak considered himself one of the top ten. In Asian banks he was a legendary figure. Even when he dealt through Citibank and Bank of America, dealers in the Far East would recognise his play and say - "Hey, that's Johnny Ruz' making a move".
He was courted by the finance houses, treated to a big game at the Super Bowl, and was taken to the 2000 US open golf championship at Pebble Beach. Last year when he attended the Robin Hood ball in New York, bankers who wanted to deal with him lined up to shake his hand as the gathering was entertained by Gwyneth Paltrow.
Now John Rusnak spends his time at home coming to terms with the prospect of a long prison sentence. At least he knows he won't be thrown in among violent criminals, but will serve time in an open prison, he told a friend. He has no previous convictions and is co-operating fully with the FBI, going for interviews with FBI agents about once a week in the company of his lawyer, David Irwin. It will be a long drawn out process, as other officials at Allfirst have started hiring their own lawyers. Rusnak knows how important it is for his defence - and for his personal life - to be straight with the FBI, he told a friend, who remarked, "His colleagues will be hurt but he is doing what is best for himself at different levels and he is aware that if he tells the FBI something untrue they are going to kill him."
Mr Irwin, who is shielding him from the media so as not to prejudice court proceedings, has refused to comment other that to insist that his client has not embezzled any money. The FBI seem to have accepted that. Unusually in such a case they have not sequestered any of Rusnak's assets, though he could eventually face a huge fine.
The former trader lives now on his savings - he was apparently pretty frugal when he was earning up to $200,000 a year in salary and bonuses - and he has the help of a supportive family. His main property consists of the rambling Victorian house he and his wife bought for $217,500 when they moved to Baltimore in 1993 with some of the $375,000 from the sale of his previous home in Connecticut and a $135,000 mortgage from Harbour Federal Savings. It was a shambles when they moved in, with eight bedrooms divided into three apartments and four kitchens, and special devices installed by the previous owner who was a handicapped woman. Rusnak spent a lot of time knocking down false walls and getting a lot of fun fixing it up, and is starting work on a side driveway this summer.
An 18-handicap golfer - he played sometimes with treasury head David Cronin who lives nearby but with whom he cannot now talk for legal reasons - he is giving up membership of his club which he cannot afford any more.
His personal friends and family stood by him when the storm broke. Many dropped by the house on Smith Avenue in rural north west Baltimore. "It was like a wake," said one, "with people even bringing food."
Outside work, the aggressive trader was seen as an engaging, nice guy. The other side of John Rusnak was the quiet family man, married to the deeply religious daughter of a Methodist minister. A native of Pennsylvania where his father Emil was a steel worker and his mother Angelina a state registrar of death certificates, he didn't have a flashy lifestyle and he was an active parishioner at the Shrine of the Sacred Heart Catholic Church, and he also did voluntary work. His two children Katie and Alex attend the Sacred Heart school, which has been helpful in protecting them from the scandal. The school was closed the day after the news broke as tabloid photographers gathered outside, and next day parents and teachers parked their cars in such a way as to block them getting into the parking lot. On Ash Wednesday however Rusnak was frustrated from going to church by photographers eager to get a picture of him as a penitent, according to a friend who recalls him saying something to the effect that "every jerk who did something wrong picks up a bible", and he was not going to be depicted in that light.
He apparently speaks frequently of his personal remorse, and, unlike "rogue trader" Nick Leeson, who brought down Barings Bank, he has let it be known he does not intend writing a book as he does not want to profit from his actions and put his wife through it all again.
He told friends he knew the game was up shortly after a team of treasury auditors from Allied Irish banks arrived in Allfirst in Baltimore on January 28th to start going through his trading records. They did not talk to him but questioned other staff. Certain things could not be concealed any more, he knew, and the end game had started. On Friday of that week he packed all his personal stuff into a cardboard box and left his 12th floor office for good.
No one tried to stop him. He was never a fugitive, friends say, though Allfirst officials told the media he was "missing". He just refused to take their calls, and he stayed away from the house to let the heat die down a bit - and contact a lawyer.
