The FSA has fined UBS  £29.7 million for failings in their systems and controls that allowed an employee to lose US$2.3 billion due to unauthorised trading.

The fine was discounted from £42.4 million for early settlement. Kweku Adoboli has been convicted of two counts of fraud and sentenced to seven years in prison for the rogue trading that he carried out in the London branch of UBS between 1 June 2011 and September 2011.

Adoboli incurred losses primarily on exchange traded index future positions, disguising the underlying positions through late bookings of real trades and booking fictitious trades.

The FSA states that significant control breakdowns allowed the trading to remain undetected for an extended period of time, including the computerised risk management system, the trade capture and processing system and a lack of sufficient challenges and supervision of Front Office trading from the Operations division.

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