The London Whale: $6B Loss

Lehman Brothers under Richard Fuld dove headfirst into hyper leveraged mortgage backed securities. They used short term borrowing to fund long term risky positions. When the US housing market began to crack, the whole structure collapsed, resulting in the largest bankruptcy in American history. Shareholders were wiped out, customers lost billions, and the public, many of whom never touched a subprime mortgage, ended up footing the bill. Through the aftermath of the financial crisis. This isn't just history, it's still happening. In 2011, UBS trader Kweku Abadoli secretly racked up 2.3 billion in losses through unauthorized trades in exchange traded funds tied to stock indexes. Again, he was using bank capital, which ultimately means the combined deposits of ordinary customers.