UBS Raises Estimate of Losses from Rogue Trades to $2.3 Billion

UBS (NYSE:UBS) raised estimate of losses from unauthorized trades to $2.3B. Kweku Adoboli, the trader at the center of the "rogue trader" controversy was charged with fraud and false accounting dating back to 2008. The Company issued the following statement, "On September 15, UBS announced that it had discovered unauthorized trading in its Investment Bank. This trading was conducted by a trader in its Global Synthetic Equity business in London. The trader in question has been charged by UK authorities with fraud by abuse of position. We have now covered the risk resulting from the unauthorized trading, and the equities business is again operating normally within its previously defined risk limits. The loss arising from this matter is $2.3B. As previously stated, no client positions were affected. The loss resulted from unauthorized speculative trading in various S&P 500, DAX, and EuroStoxx index futures over the last three months. UBS's Board of Directors has set up a special committee to conduct an independent investigation of the unauthorized trading activities and their relation to the control environment." Shares of UBS are trading down 1.35% to $11.72 in the pre-market session this morning.