Adoboli Tells Court of Market Pressures
Kweku Adoboli, who is accused of unauthorized trading which led to losses of $2.3 billion at UBS told a jury that he was "devastated" at the losses caused to the Swiss bank.
He told Southwark Crown Court when asked how he felt about the losses. "The first thing I said to the world is I was sorry beyond words. I'm devastated ... I'm devastated to put UBS in that position and I'm devastated that my friends lost their jobs, I'm devastated that in order to tell the world about who I am – I have to tell things about my organization they wouldn't want me to."
He added: "I'm devastated but in the end the reason I'm most sad is because these losses weren't the result of dishonesty or fraudulent behavior. It was the result of a group of traders who were asked to do too much with too little resource in a market that was too volatile. I wish that we had stopped to take stock of where we were."
A tearful Mr. Adoboli told the jury how from July 2011 onwards he "absolutely lost control" of his trading in July following a "maelstrom of pressure."
Mr. Adoboli said he came under huge pressure from other traders in late June for his view of the market and on July 1 he flipped his trading position after switching from a bearish view of the market to a bullish one.
"In the maelstrom of pressure to change my position, I lost control, the result of that loss of control was an increasing number of breaks, more frantic trading activity, less controlled decision making process ... I absolutely lost control. I was no longer in control of the decisions around those trades," he told the jury in his third day of testimony.
He told the court that the losses began to mount up and by the end of July he was "a bit catatonic" and was "struggling with the pressure" and was not properly sleeping or eating. He told his girlfriend in late July he had "lost a ton of money and was not sure what to do."
She told him to "maybe go and tell someone" as "this is going to kill you."
Mr. Adoboli told the jury: "I'd told different people different stories about what the trades were to buy time to recoup the losses."
He told the court how he came into work extra early at 4 a.m. on August 11 and this was the first time he had appreciated the scale of huge losses incurred by the trades.
"I didn't know just how big the position was," he told the court. "I didn't know, I'd become desensitized to just how big the trades were."
He told the court that he needed "to buy time to allow the market to play out" so he could recoup the losses and so he had lied to two people in the back office of UBS who raised questions about the trades.
He said he had lied because the losses were huge and "I thought it was the right thing to do to buy time to avert the losses."
He said by September all the three members on his ETF desk were fully aware of the losses and he had talked to them about the possibilities of them going to UBS as a whole team to report the loss position or Mr. Adoboli going to report the loss to the bank alone. Mr. Adoboli told the court it was decided he would go alone and by that stage he had decided to resign anyway and leave banking.
The three other ETF desk members have denied knowing details of Mr. Adoboli's activities in the summer of 2011 in earlier evidence during the trial.
He told the court that after further queries from Will Steward a UBS back office accountant on September 14 he decided to send what the prosecution have termed a "bombshell email" explaining his trades.
Mr. Adoboli denies four charges of false accounting and two of fraud by abuse of position. The trial continues.