May 18 2013 Latest news:
Tuesday, November 20, 2012
A Whitechapel trader convicted today of the country’s biggest ever banking fraud has been jailed for seven years.
"This was the UK’s biggest fraud, committed by one of the most sophisticated fraudsters the City of London Police has ever come across."
Kweku Adoboli, 32, of Clark Street, was found guilty at Southwark Crown Court of two counts of fraud after causing the Swiss bank UBS to lose £1.4billion.
Over the course of his nine-week trial, jurors heard the former public schoolboy exceeded his multi million-pound trading limits and failed to hedge trades, allegedly faking records to cover his tracks at the Swiss bank’s London office.
He admitted the losses but claimed that he was pressured by staff to take risks, culminating in bad deals which wiped £2.8 billion off the bank’s share value when they were discovered.
Adoboli wiped away tears as he sat in the dock during the sentencing.
Mr Justice Keith told him: “Whatever the verdict of the jury you would forever have been known as the man responsible for the largest trading loss in British banking history.”
He added: “Your fall from grace as a result of these convictions is spectacular.
“The fact is you are profoundly unselfconscious of your own failings.”
Adoboli joined UBS as a graduate trainee in 2003 and, at the time of the fraud, worked for its global synthetic equities division, buying and selling exchange traded funds (ETFs), which track different types of stocks, bonds or commodities such as metals.
The prosecution argued that he was a gambler who believed he had the “magic touch”.
He claimed everything he had done was aimed at benefiting the bank, where he viewed his colleagues as “family”.
Adoboli claimed he had “lost control in the maelstrom of the financial crisis”, and was doing well until he changed from a conservative bearish position to an aggressive bullish stance under pressure from senior managers.
He was cleared of four counts of false accounting.
Speaking afterwards, Detective Chief Inspector Perry Stokes, from the City of London Police, which investigated Adoboli, said: “This was the UK’s biggest fraud, committed by one of the most sophisticated fraudsters the City of London Police has ever come across.
“To all those around him, Kweku Adoboli appeared to be a man on the make whose career prospects and future earnings were taking off.
“He worked hard, looked the part and seemingly had an answer for everything.
“But behind this facade lay a trader who was running completely out of control and exposing UBS to huge financial risks on a daily basis.
“Rules put in place to protect the bank’s position and the integrity of the markets were being bypassed and broken by a young man who wanted it all and was not willing to wait.
“When Adoboli’s pyramid of fictitious trades, exceeded trading limits and non-existent hedging came crashing down, the repercussions were felt in financial centres around the world.
“Now, just a year on, he is facing the reality that he was not above the law and will be made to pay for his crimes.
“Others who tread a similar path to his can expect the same fate.”
A UBS spokesman said in a statement: “We are glad that the criminal proceedings have reached a conclusion and thank the police and the UK authorities for their professional handling of this case.”