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UBS 'rogue' trader arrested over £1.3bn losses
Police have arrested a man over allegations of unauthorised trading that has caused huge losses at Swiss banking giant UBS.
Markets
Police have arrested a man over allegations of unauthorised trading behind huge losses at Swiss banking giant UBS
City of London police detained Kweku Adoboli, a 31-year-old trader, at 3.30am this morning on suspicion of fraud relating to $2 billion (£1.3 billion) at UBS.
Adoboli worked in UBS' exchange traded funds (ETF) business in London. HIs manager, John Hughes, is believed to have resigned. Both men were directors in UBS’ Global Synthetic Equities Trading team.
The news wiped more than 7% off the value of UBS shares in Zurich.
In a statement UBS said ‘it is possible that this could lead UBS to report a loss for the third quarter of 2011. No client positions were affected.’
In the City there was amazement that investment banks had not improved the monitoring of traders following the case of Jerome Kerviel, the French trader who was convicted in 2008 of causing €4.9 billion of losses at Societe Generale.
Simon Morris of CMS Cameron McKenna, the law firm, said 'This makes grim reading at a time when investment banks are distancing themselves from the casino banking excesses of recent years.'
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7 comments so far. Why not have your say?
William Bishop
Sep 15, 2011 at 19:32
In contrast to the quote from Simon Morris, I had thought that investment banks were still carrying on in much the same way as previously. I had not, though, realised that this even extended to their inability adequately to control the risks taken by traders!
report thisdave devilliers
Sep 15, 2011 at 20:06
How many other stories like this are there in the woodwork?
Think about it?
The need and the greed.
report thisFranco
Sep 15, 2011 at 21:42
So much for Swiss banking probity. It has now reached emerging market level. Obviously, the UBS supervisors were as incompetent as those at the other banks that went the same way.
Take the loss out of the CEO;s bonuses and then sack him.
report thisbarry watson
Sep 16, 2011 at 08:46
after previous fiasco,s how the dickens can these banks have so little control over their staff they can let this happen yet again.
it shows just how bad the management of the banking system is, can you imagine any other industry where an employee could simply loose millions and yet the top managment wouldnt know about it.
vince cable is obsolutley right in his assumptions about the sector as a whole ,its run by a bunch of total incompetants.
WHERE ARE THE CONTROLS?
report thisdave devilliers
Sep 16, 2011 at 09:14
In a word, Incompetence...
Two words.... Negligence...
Three words,.. Arrogance...
Four Words.., Complacency.
report thisbarry watson
Sep 16, 2011 at 09:21
dave devilliers....spot on friend
report thisdave devilliers
Sep 16, 2011 at 09:39
Post Lehman established the Sense of Entitlement...
The Entitlement to ride out of Dodge on the backs of the Tax Payers...
@!*!!$£^ them
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