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UBS trader charged with fraud in $2 billion bank loss

Kweku Adoboli, the UBS AG trader arrested in London after the investment bank revealed losses of $2 billion from unauthorized trading, has been charged with fraud and false accounting.

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Kweku Adoboli, the UBS trader arrested after the Swiss investment bank discovered a $2 billion loss from unauthorized trading, was charged with fraud and false accounting on Friday by London police.

Adoboli, 31, remains in custody amid an ongoing investigation, Bloomberg reports. He is to appear before a City of London Magistrates court later on Friday.

UBS AG is in "turmoil" after the revelation of the massive loss, and ratings agencies are warning of possible downgrades for the troubled investment bank, Reuters reports.

Adoboli, who worked as a director of exchange traded funds for the Zurich-based bank, was arrested at the bank at 3:30 am Thursday, Agence France-Presse says. Shortly after his arrest, UBS announced that it had lost $2 billion in unauthorized trading. UK law firm Kingsley Napley has been hired to represent Adoboli.

News media in Ghana are reporting that Adoboli's father is John Adoboli, a retired United Nations employee who is a Ghanaian.

The Associated Press reports that Adoboli was educated at top schools and had a luxury lifestyle in London.

UBS has sent a letter to its staff saying that the unauthorized trading "could lead UBS to report a loss for the third quarter of 2011. No client positions were affected."

"While the news is distressing, it will not change the fundamental strength of our firm," UBS said. "We urge you to stay focused on your clients, who are counting on you to guide them through these uncertain times."

City of London Police are working with the Financial Services Authority, the Serious Fraud Office and the Crown Prosecution Service on the case, Bloomberg says.

http://www.globalpost.com/dispatch/news/business-tech/110916/ubs-ag-rogue-trader-kweku-adoboli-charged-fraud