ubs trader told bank of error
Last Updated : GMT 06:49:16
Arab Today, arab today
Arab Today, arab today
Last Updated : GMT 06:49:16
Arab Today, arab today

UBS trader told bank of error

Arab Today, arab today

Arab Today, arab today UBS trader told bank of error

Geneva - Arabstoday

The BBC has learned that the UBS trader being questioned on suspicion of unauthorised trading alerted the bank himself. The BBC's business editor, Robert Peston, says UBS's internal controls did not pick up the huge loss allegedly generated by its trader Kweku Adoboli. He says Mr Adoboli told UBS that he had engaged in unauthorised trades. UBS then examined his trading positions and informed the Financial Services Authority and the police. Mr Adoboli was arrested by the police at 3.30am yesterday. Our correspondent says: "The disclosure that it was Mr Adoboli's decision to inform his colleagues of his actions that set alarm bells ringing at UBS, rather than its own monitoring system, will add to concerns that investment banks simply aren't capable of controlling the huge risks that their traders take." The Financial Services Authority, the City's regulator, is investigating why UBS failed to identify the unauthorised transactions.Chris Roebuck, visiting professor at the Cass Business School said: "Why did the systems not spot this before it got totally out of control ? This is a key question the risk systems managers must answer - but he must have found a way round the systems to get this far into debt." UBS would not comment on the matter. Meanwhile, the credit rating agency Moody's says it is reviewing UBS's rating after the unauthorised trading led to a $2bn (£1.3bn) loss. Moody's said its review would focus on "ongoing weaknesses" in the Swiss bank's risk management. On Thursday, police arrested a 31-year-old man in London connection with allegations of unauthorised trading. Kweku Adoboli, believed to work in the European equities division, was still being held for questioning on Friday. Moody's said that although UBS was strong enough financially to absorb the loss, it had concerns about its risk controls. "We have continued to express concerns with regards to the ability of management to develop a robust risk culture and effective control framework," the agency said. UBS was rescued by the Swiss state in 2008, following huge losses on toxic assets held by its investment bank. It then became embroiled in a serious tax evasion dispute with US authorities and was forced to hand over 300 client names and pay a $780m fine. There was then a second case in which it agreed to hand over data on 4,450 US clients.UBS said no customer accounts had been affected by the rogue trades, but in a letter to its 65,000 staff it warned that they could hit profits. "The matter is still being investigated. It is possible that this could lead UBS to report a loss for the third quarter of 2011. No client positions were affected," the bank said. Mr Adoboli is believed to have worked as a director of Exchange Traded Funds in the equities department. ETF's are a type of tradeable share that track movements in other indexes or commodities, and can be affected by short-term volatility in prices. UBS declined to say in which department, or country, the rogue trader operated. However, there is speculation that the losses may have occurred in foreign exchange trades. Louise Cooper, markets analyst at BGC Partners, said they could be linked to last week's sudden sharp fall in the Swiss franc after the Swiss National Bank said it would intervene to hold down its value. Mr Adoboli's father, John, a retired United Nation's employee, said he hoped his son would be freed on bail soon so he could talk to him. He said he believed in his son's integrity: "From what the reports are saying it could be that he made a mistake or wrongful judgement," he said. The UBS news has echoes of other rogue trades, including at Societe Generale, where former trader Jerome Kerviel was arrested in 2008 over unauthorised trades which cost the bank 4.9bn euros. That topped the losses involved in the infamous case in 1995, which saw Briton Nick Leeson cause the collapse of Barings bank after costing the group £800m. Banks such as UBS have tightened their compliance and rules, but this latest breach "is a staggering demonstration that all the clever systems that the banks now have still cannot stop a determined individual getting round them if they want to," said Professor Chris Roebuck, visiting professor at Cass Business School. Last month the bank announced 3,500 jobs cuts. Of the 65,000 staff worldwide about 6,000 are in the UK, with the bulk of UBS's investment banking operations based in London and New York. UBS shares closed 11% lower on Thursday after it announced it was investigating the rogue trades.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

ubs trader told bank of error ubs trader told bank of error

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

ubs trader told bank of error ubs trader told bank of error

 



GMT 10:06 2012 Saturday ,28 July

Querrey advances at ATP LA Open

GMT 21:15 2017 Thursday ,01 June

Trump condemns deadly Kabul explosion

GMT 02:15 2017 Thursday ,24 August

Is your country on the Qatar free entry list of 80?

GMT 19:48 2016 Monday ,03 October

Controversial boxing champ Tyson Fury retires

GMT 08:20 2015 Tuesday ,08 December

PC market woes show no sign of easing

GMT 17:27 2017 Tuesday ,25 April

20 Yemeni soldiers killed, injured in explosion

GMT 11:52 2017 Saturday ,30 December

OIC condemns Mar Mina Church attack

GMT 00:03 2017 Saturday ,25 March

Arab Meeting to Examine Anti-Corruption Methods

GMT 13:12 2017 Thursday ,20 April

Deputy premier meets Arab League chief

GMT 14:13 2014 Friday ,10 January

Opel Astra GTC

GMT 18:27 2016 Tuesday ,02 August

Turkish Foreign Minister arrives in Islamabad

GMT 11:27 2016 Tuesday ,13 December

Saudi woman arrested for challenging social norms
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday