Tribunal upholds £1.25m FSA fine on former UBS trader for rogue trades with client cash
THE FSA has had its decision to fine a UBS trader £1.25m upheld by the upper tribunal, an independent judiciary body.
Sachin Karpe, head of a trading desk in the bank’s institutional wealth management business, was fined in 2009 for engaging in “unauthorised trading”, including an attempt to subvert Indian law by helping an Indian client make a $250m (£158.2m) investment in a vehicle open only to non-Indians.
The tribunal also confirmed the FSA’s findings that Karpe had transferred money from other clients’ accounts in order to cover losses from his trades.
Karpe also directed trader Laila Karan to assist in creating records that aimed to make it look as if the client transfers had been instructed. She was fined £75,000, which was also upheld by the tribunal.
Both Karpe and Karan were also banned from taking on new roles in financial services “for failing to act with integrity”.
It is understood that the police had looked at the file but did not pursue the case, in part because Karpe did not make much in personal profits from his trades.
UBS was fined £8m in 2009 for compliance failings but did not appeal the penalty. It compensated clients to the tune of $42m.