If banks want to reduce risks associated with rogue traders, the answer is simple: Require all traders to wear Google Glass.

For the luddites of the world, Google Glass is a wearable computer mounted in modern-looking eyeglasses being developed by Google.  

Forcing traders to strap computers on their heads may sound extreme, but consider the current threat. Trading positions in derivatives, foreign exchange and securities have grown exponentially in the last decade and with them the exposure to rogue traders. (In 1998, when Long-Term Capital Management lost $4.6 billion, it was feared the firm would bring down the entire market. Ten years later, Jerome Kerviel, a single trader, lost $7.2 billion through unauthorized trading at Société Générale.) 

Orwellian or not, putting computer-enhanced glasses on traders is the next logical progression. When I started working on trading floors in the mid-1980s, phone conversations were already being taped on large magnetic reels in a back room. Finding specific conversations on those tapes could take hours. Then along came digital recording, which made the process easier.

When electronic trading was introduced, it appeared we had eliminated the possibility of traders simply lying about trades or counterparties. But rogues found a way. Using old-fashioned trickery and dummy accounts, Nick Leeson was able to circumvent the electronic record-keeping at Barings for nearly three years. The bank failed in 1995 as a result of Leeson's $1.4 billion loss.

Traders have come to accept that our email, texts and trading conversations are all recorded and discoverable in court.  We understand that the IT department can log on to our system and watch in real time anything that we do on our computers.  Cameras monitoring the workplace do not shock us. Still, none of this stopped UBS's Kweku Adoboli from losing $2 billion through unsanctioned trading in 2011.   

If traders knew that compliance staff was recording and occasionally live-monitoring their trading floor activities from their perspective, could we prevent future multibillion dollar losses? Unlike previous methods of keeping tabs on trading desks, Google's new device will record every conversation and store everything the trader sees.  Would the knowledge that everything we did was being recorded change our behavior?

The glasses could provide interesting benefits for traders: streaming prices in the corner of your vision, Skype conversations with counterparties. The trading floor has always been a place of cutting-edge technology. However, helping rid the world of rogue traders could be one of the immediate benefits of Google's new technology.  

Many rogue traders, like Kerviel, have contended that management knew and condoned their trading. Digital recording of such management interactions could help determine the truth behind such allegations.  It could also potentially help settle claims of harassment or discrimination.

The cost of installing the hardware and hiring staff to monitor the glasses could be offset by the elimination of a single major trading loss. If senior management could later review trading activity, from the trader's perspective, wouldn't our financial system benefit?  

Admittedly there is something unnerving about having someone electronically "looking over your shoulder" all day long, but we will adjust. The electronic Pandora is out of the box. We should at least benefit from the intrusion she has brought into our lives. Saving billions from rogue trading losses might take the sting out of the loss of privacy.

As I say, the answer is simple: it's a choice between Orwell or rogue traders.  All thanks to Google.

Richard Magrann-Wells is a senior vice president and the Financial Services Practice Leader for Willis North America.