John Hughes, the former senior trader on the ETF desk, said Adoboli told him in January last year about an internal account he called his umbrella. Prosecutors allege Adoboli created the account to pool profit from trades he hadn’t booked to use to cover up future losses. Hughes testified that he thought the umbrella referred to a profit pool that hadn’t been booked. “You live in blue sky scenarios,” Hughes wrote in an instant-message exchange with Adoboli in January 2011. “It often rains,” Adoboli responded. “I learned that last year. So I built an umbrella.” [BusinessWeek, Related: "I take responsibility for my actions and the shit storm that will now ensue."]
Kweku Adoboli Is A Free Man!
Kind of! Though he doesn't go to trial until September, the UBS's rogue trader was granted bail after ten months in jail and a February denial to go home. Naturally, he's pretty pleased about the turn of events (which allow for sleepovers). Mr. Adoboli, 32, has to stick to a curfew but can stay at a friend’s house wearing an electronic tag as part of the bail agreement. Tim Harris, Mr. Adoboli’s lawyer at Bark & Company, said his client was “delighted” and would like to thank family and friends for their support in achieving his release. Mr. Adoboli is expected to be released from London’s Wandsworth prison as early as Monday, Mr. Harris said. Mr. Adoboli had pleaded not guilty to counts of false accounting and fraud. He was arrested in September after UBS alerted the police. The bank claimed that Mr. Adoboli had masked the billion dollar losses from internal controls with fictitious trades. Mr. Adoboli has remained in custody ever since his arrest. The trading scandal rocked the Swiss bank and led to the resignation of its chief executive, Oswald J. Grübel. Denying Mr. Adoboli bail in February, the judge said that the allegations against the former trader were “serious” and “backed up with cogent evidence.” Former UBS Trader Is Granted Bail [Dealbook]