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UBS trader gambling of $2.3bn pushes UBS at brink of collapse

A former UBS trader Kweku Adoboli has been accused of frauds that cost Swiss bank UBS a loss of up to $2bn.

During a trial of a lawsuit in London, the prosecution has argued that Adoboli did "reckless and unauthorised" trading, and placed the bank over the edge of collapse, between October 2008 and last September.

He allegedly used the bank’s funds to trade beyond his limit and also cooked books to show that the bank was actually earning income through his trading.

A fall in the bank’s share price, owing to the news, caused a loss of £2.8bn to the Swiss lender, it was argued.

Prosecutor Sasha Wass said, "This colossal loss arose purely as a result of Mr Adoboli’s fraudulent deal making, which amounted, as you will see, to nothing more than gambling."

Wass said he had been "sucked into the gambler’s mindset" and "started throwing good money after bad".

Adoboli had been working as a senior trader at UBS’s global synthetic equities branch, buying and selling exchange traded funds, which follows different types of stocks, bonds or commodities such as metals.

Wass also accused Adoboli of "fraudulently side-stepping" the bank’s rules that banned high risk and unauthorized investments.

"Mr Adoboli had ceased to act as a professional investment banker and had begun to approach his work as a naked gambler. He had become what is sometimes referred to as a rogue trader," Wass added.