UBS’s Kweku Adoboli is in trouble for allegedly making trades that ultimately cost the beleaguered bank $2.3 billion.
However, conspiracy theorists think Adoboli is no rogue trader. Rather, they think UBS is letting him take the fall for firmwide losses.
Now, why the hell would they do that?!?!
UBS’s name has already been dragged through the mud. Tax evasion. Multi-billion dollar writedowns. Retention problems. The last thing clients and investors need to hear is that UBS doesn’t know if its own employees are crooks. Adoboli was acting on his own. He was a rogue trader.
NOT SO FAST, say conspiracy theorists.
UBS is a financial services firm. It would much rather be embarrassed for having lax operational risk management, than be known for financial market incompetence. After all, what good is a financial services firm that doesn’t know how to trade in the financial markets? If UBS announced Q3 earnings and said, “We lost billions of dollars on wrong-way bets on the market,” they’d look really stupid. For market credibility’s sake, they would be better off saying, “We lost money because just one of our guys committed fraud. Sorry, for not keeping tabs on him.” Adoboli was paid off to be a scapegoat. (An 8-figure hush fund in a secret Swiss bank account would explain that million dollar smile.) He was a fall guy.
Anyways, this has sparked debate at the Business Insider offices. We’re split. What do you think?
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