UBS 'rogue trader' goes on trial in London
A trader accused of losing $2.3 billion at the Swiss bank UBS in what is alleged to be Britain's biggest banking fraud appeared in court on Monday for the start of his trial.
Ghanaian-born equities trader Kweku Adoboli denies two counts of fraud and two counts of false accounting, alleged to have taken place between 2008 and September 2011.
The 32-year-old wore a dark grey suit and white shirt for the hearing in a London court.
The initial stages of the trial were procedural and the prosecution case is not expected to open until later this week.
Adoboli is accused of dishonestly using his position to try to make a personal gain, and causing UBS losses or exposing the bank to the risk of loss.
The son of a Ghanaian former United Nations official, Adoboli worked for the global synthetic equities division at UBS in the City of London financial district.
Adoboli, who was privately educated in Britain and attended Nottingham University, was arrested in London on September 15 last year on suspicion of the fraud.
His work involved buying and selling exchange traded funds, which track different types of stocks or commodities such as precious metals.
Adoboli was granted bail on June 8, on condition that he wore an electronic tag.
UBS declined to comment on the case.
"The UK criminal process is ongoing and will run its course," it said in a statement on Monday.
"In the meantime UBS remains completely focused on our clients and on continuing to deliver on our strategy. UBS is not a party to the case and therefore has no further comment."
The bank has previously said that the losses -- initially estimated at $2 billion then revised upwards to $2.3 billion (1.8 billion euros, £1.4 billion) -- arose from allegedly unauthorised speculative trading in S&P 500, DAX and EuroStoxx index futures.
The true magnitude of the risk exposure had been hidden through "fictitious" positions allegedly taken by the trader, the bank said, adding that they took place over a three-month period.
Despite the colossal losses, UBS's chief executive at the time, Oswald Gruebel, refused to step down.
The bank's honorary chairman Nikolaus Senn, however, said that adequate checks had not been implemented and criticised Gruebel for his over-reliance on the controls system to uncover problems.
Gruebel eventually left the bank in the aftermath of Adoboli's arrest.
His replacement, Sergio Ermotti, admitted in a statement to UBS staff this month that the case would be "uncomfortable" for the bank.
"Amidst all the progress that we have made since this incident, we must never forget that our reputation is more important than anything else and that every one of us is a guardian of that reputation," he said.
The case has sparked debate in Switzerland about the future of investment banking, which was also at the root of UBS's colossal losses in the US subprime crisis.