UBS Faces Large Fine From Swiss and UK Regulators After Trial

Kweku Adoboli

The Swiss bank UBS is braced for a fine and reprimand from regulators after its former trader Kweku Adoboli was jailed for fraud.

The UK's Financial Services Authority and the Swiss financial market supervisory authority (Finma) are also investigating the trading activities of Adoboli, who was jailed on Tuesday after a jury at Southwark crown court found him guilty of two counts of fraud, although he was cleared on four other charges.

Finma is expected to announce its findings within days but while it can make public statements and demand changes to operations it does not have the power to impose fines. The FSA is expected to fine UBS and can also has the powers to penalise individuals who were authorised to worked in the London arm of Adoboli's bank.

The FSA announced in February that its investigation had been passed to its enforcement arm, signalling that some form of reprimand was likely. Adoboli, who lost UBS £1.5bn, had used a secret account, known as his "umbrella",for some of his trading activities. Three colleagues told the court that they knew of the secret account.

The largest fine ever imposed by the FSA was the £59.5m slapped on Barclays for attempting to manipulate the Libor benchmark interest rates.

Powered by Guardian.co.ukThis article was written by Jill Treanor, for The Guardian on Thursday 22nd November 2012 20.19 Europe/London

guardian.co.uk © Guardian News and Media Limited 2010

 

image: © thetaxhaven

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