The fallout from the UBS trader who lost $2.3 billion of the firm's money betting on index futures is grim, according to BusinessInsider.
Turns out, he wagered $10 billion on positions on S&P 500, DAX, and EuroStoxx index futures over the last three months, and he allegedly falsely accounted for the hedges off-setting the potetial risk of those trades. Before Kweku Adoboli's ficitious hedges were discovered, the firm had plans to layoff over 3,500 people in order to save $2 billion. Abodoli's loss more than reverses the savings effect of those layoffs.
Other effects:
Adoboli's boss, John Hughes, resigned last week
Other members of the Delta One team were sent home
UBS created a taskforce called "Project Bronze" to unwind the position on Friday
UBS appoints David Sidwell, the Swiss bank's British-born senior independent director, and the former CFO of JPMorgan, to lead a team that wil figure out how the alleged fraud was carried out, why risk controls were not activated and to look at putting measures in place to stop it from happening again
Find out more at http://www.businessinsider.com/kweku-adoboli-10-billion-sp-500-dax-eurostoxx-3-months-2011-9
No comments:
Post a Comment