Operational risk encompasses a broad category of non-financial risks arising from daily business operations, including fraud, system failures, human error, and natural disasters. Basel III capital frameworks require banks to hold capital against operational risk calculated through standardized or advanced measurement approaches. The 2012 JPMorgan London Whale trading loss of over $6 billion exemplified how operational risk failures in oversight and risk modeling can generate massive losses. Organizations manage operational risk through process controls, segregation of duties, system redundancy, training, and business continuity planning. Operational risk events often interact with other risk types, creating cascading failures.