Indian offshore IT service was part of the cause of £1.4bn loss at UBS

It seems, according to this report, that the £1.4bn loss at UBS caused by a rogue trader could have been avoided if a service managed offshore by an Indian IT services provider had not failed.

The FSA reported that: “The computerised system operated by UBS to assist in risk management was not effective in controlling the risk of unauthorised trading.#

An offshore service  used by UBS used to detect suspicious trading activity that was undertaken by  London based UBS trader Kweku Adoboli losing, who caused £1.4bn losses.

 The Financial Services Authority (FSA) has fined UBS £29.7m for failings that led to trader making the losses. 

I wonder if this changes how regulators look upon outsourced services? At the moment banks are under pressure to sort out their ships and events like this could make the regulators and for that matter the public anti-offshoring.

Mind you it probably could have happened anyway, no matter where the service was run from.

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Of course. I have worked with Indian service providers for years and have never yet witnessed a project finished on time, with decent quality at a decent price. All Indian I T firms want is the contract signed, money in the bank, then they will figure out how to deliver, or not deliver (the contracts always have enough weazle words, or sometimes they just dont bother and say sue me). My own view is that Indian I T firms are now merely providers of Visas for employees and management.