Kweku Adoboli, the ex-UBS AG trader, who caused $2.3 billion in losses for his bank due to illegal, unauthorised trading (the largest in British history), has been sentenced to seven years in jail.
Throughout the trial Adoboli pleaded not guilty to the claims of fraud, stating that his managers at UBS pushed the traders to take risks and break rules.
Following a similar case at Societe Generale SA, where Jerome Kerviel caused a $6.3 billion trading loss, UBS warned all of its employees to keep an eye out for illegal trading. Adobli, meanwhile, claimed that the only way to achieve the bank’s set goals was by ignoring such warnings.
Andrew Penhale, deputy head of fraud at the Crown Prosecution Service, explained that “behind all the technical financial jargon in this case, the question for the jury was whether Kweku Adoboli had acted dishonestly, in causing a loss to the bank of $2.3 billion. The amount of money involved was staggering, impacting hugely on the bank, but also on their employees, shareholders and investors.”
The ten man jury unanimously voted that Adoboli was guilty of fraud.
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Judge Brian Keith told Adoboli upon his sentencing, that, “you are profoundly un-self-conscious of your own failings. You were arrogant enough to think that the bank’s rules for traders didn’t apply to you.”
According to Bloomberg, at least 11 UBS employees were either fired, or resigned, in the fallout of this case. Including; CEO Oswald Gruebel; the heads of global equities, Yassine Bouhara and Francois Gouws; Adobli’s colleagues on the ETF desk; and his former managers, Ron Greenidge and John DiBacco.
After the verdict had been given Adoboli said that, “in the end, the reason I’m most sad is because these losses weren’t the result of dishonest or fraudulent behaviour. These losses were the result of a group of traders who were asked to do too much, with too little resources, in a market that was too volatile.”
By. James Burgess of Oilprice.com
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