Kweku Adoboli faces fourth charge

UBS trader charged with fraud relating to activities between 2008 and 2010, in addition to two allegations of false accounting and one of fraud in 2011

Kweku Adoboli, the 31-year-old charged with fraud and false accounting at UBS, was remanded in custody until 20 October on Thursday after learning he also faced a second fraud charge.

Lawyers for Adoboli, who holds a Ghanaian passport, did not make an application for bail at the hearing in the City of London magistrates court that followed the three charges police brought against him on Friday.

The alleged "unauthorised trading" announced by the Swiss bank has caused turmoil at UBS, which has raised the estimate of losses from the incident to $2.3bn (£2bn) from $2bn.

The trader spoke only to confirm his name, birth date and address at the hearing. He did not enter a plea.

He originally faced three charges. Two allege false accounting, claiming he falsified records of exchange traded funds (ETFs) – complex financial instruments – between October 2008 and December 2009 and then in January 2010 and September 2011.

The third charge alleges that he committed fraud between January 2011 and September 2011 while working as a senior trader in global synthetic equities.

The fourth charge, of fraud, was made on Thursday, relating to activity between 1 October 2008 and 31 December 2010.

Adoboli is represented by Kingsley Napley, the law firm that advised Nick Leeson, the rogue trader who brought down Barings in 1995. A committal hearing originally set for 22 October will now take place on 20 October.

UBS is under intense pressure to restore confidence in its investment banking arm. The bank's board is meeting on Thursday and Friday in Singapore, where chief executive Oswald Grübel, parachuted in to UBS in 2009 when the Zurich-based bank was on the brink of collapse, is determined to secure his future.

The head of UBS's investment banking arm, Carsten Kengeter, has urged staff to work hard to repair the "financial damage" caused by the alleged incident, which the bank has admitted will tip it will tip it to a loss in the third quarter. The traditional year-end bonuses for UBS staff are now in jeopardy unless ways can be found to bolster profitability again.

The board meetings are being held in Singapore to coincide with the Formula One grand prix, of which UBS is a major sponsor. The board is expected to discuss the bank's strategy for its investment bank amid speculation that the fixed income division and the proprietary trading arm – where the bank uses its own money to bet on markets – will be scaled back.

UBS had promised an update on its strategy on 17 November at a previously arranged investor meeting in New York, although any announcement may now be brought forward.

Adoboli was a trader on the bank's "delta one desk" and, among other things, traded ETFs. Other banks are known to have reviewed the trading activities of their delta one desks since the allegations about Adoboli were made.

Contributors

Sam Jones and Jill Treanor

The GuardianTramp

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