Rogue UBS trader jailed for seven years

UBS trader Kweku Adoboli was jailed for seven years in London on Tuesday for gambling away $2.3 billion of the Swiss bank\'s money in Britain\'s biggest ever fraud. The Ghanaian-born banker, 32, was found guilty of two counts of fraud by a jury at Southwark Crown Court but cleared of four charges of false accounting. \"There is a strong streak of the gambler in you,\" judge Brian Keith told Adoboli as he sentenced him. \"You were arrogant to think the bank\'s rules for traders did not apply to you. \"The tragedy for you is that you had everything going for you. \"Your fall from grace as a result of these convictions is spectacular.\" The judge said Adoboli would serve half his sentence before being released on licence. Adoboli wiped away tears as he was sentenced. He had admitted the losses but denied any wrongdoing. During the two-month trial he claimed senior managers were fully aware of his activities and encouraged him to take risks to raise profits. But prosecutors said that in a bid to boost his bonuses and chances of promotion, Adoboli exceeded his trading limits, failed to hedge trades and faked records to cover his tracks between 2008 and 2011. The tactics initially paid off -- prosecutors said he earned $90 million for UBS and its clients by May 2011 and the bank rewarded him with huge bonus increases, rising from £15,000 in 2008 to £250,000 ($398,000, 311,000 euros) in 2010. But as the financial crisis took hold, Adoboli\'s deals went bad. The court had heard that at one point he was at risk of causing UBS losses of $12 billion. His arrest in September wiped 10 percent off the bank\'s share price. \"The amount of money involved was staggering, impacting hugely on the bank but also on their employees, shareholders and investors,\" said Andrew Penhale, deputy head of fraud at the Crown Prosecution Service. \"This was not a victimless crime.\" A UBS spokesman said: \"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. We have no further comment.\" -- \'A trader out of control\' -- The privately educated son of a former United Nations official, Adoboli wept regularly during the trial, telling jurors he had dedicated his adult life to the bank and regarded his colleagues as \"family\". He went to work for the bank after graduating in 2003 and joined its exchange traded funds (ETF) desk in 2006, dealing with funds that rise and fall in value depending on the performance of the markets they track. By 2007, he and another more senior trader were managing a portfolio worth $50 billion. \"We were these two kids trying to make it work,\" he told the court. Discrepancies in Adoboli\'s trading activities eventually aroused colleagues\' suspicion, and in a \"bombshell\" email to a back office accountant on September 14, he confessed that the bank was exposed to colossal losses. \"I am deeply sorry to have left this mess for everyone and to have put my bank and my colleagues at risk,\" Adoboli wrote. He was summoned for questioning and arrested at the bank in the early hours of the next morning. The case has drawn comparisons to Jerome Kerviel, the French trader who lost the Societe Generale bank 4.9 billion euros ($6.3 billion) in 2008. It has also revived memories of British rogue trader Nick Leeson, who caused the collapse of Barings Bank in 1995. \"To all those around him Kweku Adoboli appeared to be a man on the make whose career prospects and future earnings were taking off,\" said Perry Stokes of the City of London Police, who led the investigation against Adoboli. \"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.\" Adoboli\'s solicitor Tim Harris told AFP he was \"naturally disappointed\" by the verdict. \"We thought we had done enough to convince the jury that they couldn\'t be sure that what he had done had been a criminal offence,\" he said outside the court. He added that Adoboli had been working in \"hugely difficult trading circumstances\" during the financial crisis, and that traders like him were sometimes given \"a lot of money to play with, with very minimal supervision\".