UBS facing FSA enforcement action over 'rogue trader'

The Financial Services Authority is to commence with enforcement action against UBS AG following an investigation into losses incurred by the investment banks as a result of alleged 'rogue trader' activity.

The Swiss Financial Market Supervisory Authority will also carry out enforcement action, following by an independent investigation by the two bodies.

Kweku Adoboli, who worked for Swiss bank UBS, recently pleaded not guilty to two charges of false accounting and two of fraud after he was accused of unauthorised trading which lost the bank around £1.5bn ($2.3bn).

He was arrested back in September when the scandal broke and the losses led to a number of high profile figures at the bank quitting, including Oswald Gruebel, the chief executive, and the chief risk officer.

In November 2009, UBS was fined £8m by the FSA for systems and controls failures which enabled employees to carry out unauthorised transactions involving customer money on at least 39 accounts.