Risk management acronym of the day

By Felix Salmon
April 29, 2009

From Mimi Swartz’s 9,700-word monster article on Sir Allen Stanford:

Stanford’s now demoralized compliance department—responsible for making sure the company followed the rules—coined a new term: FUMU, for “fuck up and move up.”

I think this happens at many banks, if not quite as egregiously as it happened at Stanford. It’s the Peter Principle taken one step further: if the people in charge of promotions are themselves utterly incompetent and/or malign, they might well end up promoting fellow-incompetents rather than anybody honest or good at what they do. And it only takes one look at Stanford’s now-arrested chief investment officer to see the natural conclusion of that process.

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