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Bank fraud could happen again, freed rogue trader warns

Published 01/08/2016

Kweku Adoboli served half of his seven-year sentence (City of London Police/PA)
Kweku Adoboli served half of his seven-year sentence (City of London Police/PA)

A former UBS trader jailed for fraud after losing the bank £1.4 billion has said it could happen again.

Kweku Adoboli, 36, was released from prison last summer after serving half of his seven-year sentence for two counts of fraud.

He told the BBC he was sorry for his mistakes but warned his former colleagues were still under the same pressure he was to make money.

He said banking had not changed since he was found guilty in 2012.

Prosecutors said Adoboli racked up the largest loss in British banking history by disguising underlying positions with late bookings of real trades and the booking of fictitious trades.

Adoboli admitted the enormous losses but claimed he was pressured by staff to take risks, culminating in a catastrophe which wiped £2.8 billion off the bank's share value at the time.

Speaking about the current state of banking he said: "I think the young people I've spoken to, former colleagues I have spoken to, are still struggling with the same issues, the same conflicts, the same pressures to achieve no matter what.

"And this goes back to the structure of the industry. People are required to take risk to generate profit, because yields in the industry are consistently compressed."

When he was asked if another trader could do what he did he said: "Absolutely."

Anthony Browne, chief executive of the British Bankers' Association, said banks have successfully embarked on a "cultural revolution".

He said: "The banks accept there have been major cultural problems in the industry, which is why they have worked so hard over the last five years to produce a cultural revolution, raising professional and ethical standards, and toughening up their corporate governance and the way they deal with risk.

"Pay has been part of the problem, and instant cash bonuses are now down about 80%. The introduction of the senior managers regime has ensured real personal accountability, so that top management know exactly what their responsibilities are, and the very real consequences they face if they fail to meet them."

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