Alleged UBS rogue trader Kweku Adoboli faces new fraud charge

The alleged rogue trader accused of gambling away a record �1.5 billion faces a second charge of fraud.

The additional charge against Kweku Adoboli, 31, adds to the two charges of false accounting over three years at Swiss banking giant UBS, City of London Magistrates’ Court heard.

Adoboli, who gave no indication of how he will plead, was remanded in custody until October 20.

David Levy, for the prosecution, said Adoboli now faces two charges of fraud.

The new fraud offence was alleged to have taken place between October 1, 2008, and December 31, 2010.

After the hearing, Alison Gowman, the chief magistrate, said Adoboli will appear at the same court on October 20 for a committal hearing.

Prosecutors allege he gambled away the cash while working at UBS’s global synthetic equities division, buying and selling exchange traded funds, which track different types of stocks, bonds or commodities such as metals.

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Adoboli, from Clark Street, Bethnal Green, east London, has made no application for bail.

The primary fraud offence allegedly took place between January 1 and September 14 this year.

Adoboli, the son of a former Ghanaian official to the United Nations, joined the bank in a junior capacity in 2002.

The �1.5 billion fraud charge against him reads: “While occupying a position, namely being a senior trader with Global Synthetic Equities, in which you were expected to safeguard, or not to act against, the financial interests of UBS Bank, you dishonestly abused that position intending thereby to make a gain for yourself, causing losses to UBS or to expose UBS to risk of loss.”

The two accusations of false accounting - which date back to 2008 - claim that he “falsified a record, namely an exchange traded fund transaction”.

After Adoboli’s first appearance in court, UBS revised upwards the cost of the alleged rogue trading to 2.3 billion US dollars (�1.5 billion) after previously saying it had cost it in the range of two billion US dollars (�1.3 billion).

City watchdog the Financial Services Authority and its Swiss counterpart have launched an investigation into why UBS failed to spot allegedly fraudulent trading.