Kweku Adoboli – A cautionary tale
I was recently listening to Kweku Adoboli on Radio 4. For those who do not know, Mr Adoboli was the trader at UBS who was convicted of two counts of fraud and sentenced to seven years of imprisonment, having lost the bank somewhere between £1.4 – £1.8 billion (depending upon which report you read). Having served half of his sentence, he is now in the process of fighting a deportation order, despite having lived in the UK for over 20 years.
As an employment lawyer, this case is of interest to me due to having listened to one of Mr Adoboli’s videos on YouTube. At almost 90 minutes it is definitely a detailed exploration of his rise and fall at UBS. Around the 40 minute mark, Mr Adoboli explains how he decided to inform UBS of the significant losses his desk had incurred. In essence, according to the man himself, he decided to “take one for the team” so to speak, and simply sent an email to senior management about what had transpired, in which he assumed full culpability for the losses.
I remain flabbergasted by Mr Adoboli’s naivety and the manner in which he informed his employer of his desk’s losses. Having read the email he sent, it is as unhelpful as any email can be and it must have caused his advisers’ much difficulty, particularly as he took full responsibility for the unauthorised trades on his desk (which he later sought to row back from). Regulatory matters are often at play when I am advising senior executives who perform regulated functions (e.g. approved persons within the FCA regime). For instance, I have had to advise senior executives who have been caught submitting unauthorised expenses and then have been accused of theft and/or misrepresentation. In such circumstances, I often have to advise clients that their employment position is the least of their concerns and they should be focusing on avoiding losing their regulatory status and/or the potential criminal sanctions. At times, this means that I need to advise clients that the safest course of action would be not to engage in any disciplinary procedure, so as to avoid saying anything incriminating, even though this means that dismissal is highly likely. In my view, staying out of Her Majesty’s Pleasure and hopefully retaining a career must take precedence.
I cannot help but imagine how different Mr Adoboli’s situation could have been had he sought legal advice prior to taking any action. It is Mr Adoboli’s position that senior staff members were aware of the processes he was using which resulted in the unauthorised trades to which they turned a blind eye. He also has stated that he was placed under pressure to take such risky actions due to the aggressive culture at his employer. Without full details on the case, one wonders if Mr Adoboli could have sought protection as a whistleblower, especially if the risky approach to trades was as actively encouraged by senior management as he appears to suggest. This could have potentially provided him with a much better defence. However, he will now forever be known as one of the UK’s worst “rogue traders”.
Without wishing to sound self-serving, Mr Adoboli’s case highlights that lawyers can provide real value if engaged early on in such circumstances. Now Mr Adoboli has lost his career and is having to fight to remain in the UK. Only time will tell if he is successful with this battle.