A City trader who lost £1.4bn ($2.2bn) of Swiss bank UBS's
money has been jailed for seven years after being found guilty of two counts of
fraud.
According to a spokesperson for the City of London police Quote this was
the UK's biggest fraud, committed by one of the most sophisticated fraudsters
the City of London Police has ever come across.
To all those around him, Kweku Adoboli appeared to be a man on the make
whose career prospects and future earnings were taking off. He worked hard,
looked the part and seemingly had an answer for everything.
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.
Rules put in place to protect the bank's position and the integrity of
the markets were being bypassed and broken by a young man who wanted it all and
was not willing to wait.
When Adoboli's pyramid of fictitious trades exceeded trading limits and
non-existent hedging came crashing down, the repercussions were felt in
financial centres around the world. Unquote
To those not familiar with the culture of “investment banking” the above
will be seen as just desserts for yet another rogue trader.
There is however a much more salutatory lesson to be drawn from this
latest banking debacle. In his defence Adoboli said that traders were
encouraged to take risks and carry on until they received a “slap on the
wrist”. Anyone who has worked in a trading environment would recognise this as
a not unusual scenario.
There is no doubt that Adoboli committed fraud but at the same time
should not his superiors also have faced some close scrutiny for their part in
the fiasco?
At the very least they are guilty of dereliction of duty/negligence.
However as we have seen in the recent past those who were in charge of
the Banks were too pre-occupied with their own rewards to spare time in
managing the interests of their shareholders.
No comments:
Post a Comment