Kweku Adoboli’s trial for gambling away £1.4bn on bad deals that almost brought down banking giant UBS began in London today. He faces charges of fraud with a maximum sentence of 10 years in jail and charges of false accounting which carry a maximum sentence of seven. The prosecutor is piling onto him, calling him a “rogue trader” and a “naked gambler”, and has accused him of lying to the bank.
Adoboli clearly has a criminal case to answer. However, shouldn’t the bank's CEO Sergio Ermotti be forced to answer some questions himself, rather than piously suggesting “we must assume that UBS’s culture and practices will be examined during the course of the trial”?
UBS is far from pristine in all of this. It was the benefactor over $59.2bn in bailout financing as it racked up the biggest losses of any European lender. Clearly, Adoboli was taking advantage of a culture and a corporation that was out of control. But this was a rotten orchard, not just a rotten apple.
And of course UBS isn't alone. This summer HSBC was hit with a massive money laundering scandal and Barclays, along with half a dozen other major banks, was directly implicated in an interest rate manipulation scandal. When bad behaviour is part of the culture, chief executives should also be held to account – not just their foot soldiers. In October, Europe will be meeting to discuss just that.
Read more: The New York Times thoroughly examines UBS's history of avoiding prosecution.
Sources: Guardian, Bloomberg, Telegraph, City AM, New York Times