May 18 2013 Latest news:
Tuesday, November 20, 2012
A Whitechapel city trader accused of gambling away £1.4 billion of UBS’s money has been convicted of two counts of fraud.
"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, who was on trial at Southwark Crown Court, was cleared of four remaining charges of false accounting between October 2008 and September 2011.
At one point the rising star, of Clark Street, stood to run up losses of $12billion (£7.5 billion) for UBS.
The Ghanaian-born 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.
Trial judge Mr Justice Keith gave the jury a majority verdict direction this morning, saying they could deliver a 9-1 verdict on the remaining five charges.
The jury has been reduced to five men and five women after two jurors were discharged.
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”.
But, giving evidence, he said 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.
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.”