Kweku Adoboli arrested over UBS ‘rogue trade’

CITY OF LONDON police have arrested 31-year-old Kweku Adoboli in connection with an alleged rogue trade that resulted in a $2bn loss for his employers, the Swiss bank UBS.

Adoboli was reportedly detained at his desk by officers in an early-hours raid. Police refused to confirm the suspect's identity, but said in a statement: "A 31-year old man was arrested at 3.30 am in central London on suspicion of fraud by abuse of position. He remains in custody."

Adoboli (above) was educated at Nottingham University and, according to the Daily Telegraph, joined UBS in 2006 as a trainee.

Shares in UBS fell 8 per cent this morning after the announcement that a rogue trade was being investigated. The bank said in a letter to staff that no customers were affected, but that the incident might lead to a loss for the third quarter.

The Financial Times reports that Adoboli worked in UBS's Delta One banking division – one of the few areas of investing in which banks use their own money. As such, traders of Delta One products "can still get away with taking ample risks".

Interestingly, Jerome Kerviel, the 'rogue trader' whose activities caused a loss of €4.9bn at the French bank Societe Generale in 2008, worked in the Delta One products team of his employers.

Chris Roebuck, visiting professor at Cass Business School, told the BBC that the latest alleged rogue trade "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".

He said it would fuel the debate over "casino" banking. ·