Last month, we noted that a group of UBS employees who “worked in operations and were responsible for securities movements and payments” had been escorted out of the building and told not to come back “pending an internal review into their conduct.” Now we’ve been informed they were recently told not to come back, period. If you’re a current employee or about to join the firm and are unclear on the rules, know this: it turns out UBS does in fact frown upon skimming some off the top for yourselves.

“The employees were transferring securities that UBS held to personal accounts and then just selling them in their personal account. Not sure how the bank didn’t know, but apparently it went on for a few years.

We were told last week that the employees in question were asked to resign and given severance packages. UBS declined to comment, other than to confirm that the people are “no longer with the bank.”

Article courtesy of Dealbreaker

As you may have heard, UBS has been going through a bit of a rough patch. Despite posting an annual profit (of 7.2 billion Swiss francs) for the first time since 2006, things just haven’t been the same since the crisis, and some have suggested it never will be, claiming that the bank “doesn’t have a chance” getting back to pre-crisis levels because “too much damage has been done.” Not helping things is the fact that there’s been very high turnover in the last couple months, which may have something to do with the fact that people would like to get paid. What you may not have heard is that the investment bank? Is kicking ass, according to Chairman Oswald Gruebel who is kind of confused as to why the media has chosen to ignore the division’s “steady progress” but wants employees to know he, for one, has not.

UBS Chief Sends Memo to I-Bankers [NetNet via BI]

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As you may have heard, UBS has been going through a bit of a rough patch. Despite posting an annual profit (of 7.2 billion Swiss francs) for the first time since 2006, things just haven’t been the same since the crisis, and some have suggested it never will be, claiming that the bank “doesn’t have a chance” getting back to pre-crisis levels because “too much damage has been done.” Not helping things is the fact that there’s been very high turnover in the last couple months, which may have something to do with the fact that people would like to get paid. While a handful of marquee names (within the industry) have been lured with big checks, many senior bankers have heard nary a peep re bonuses in several years (and the staff’s pay overall is nothing to write home about, either). As one might imagine, tension is running high and recently within the investment bank, there’s been a decision, among those who’ve yet to quit, to air their grievances. The reaction from management? Put a sock in it.

On early morning conference calls, UBS AG investment-banking chief Carsten Kengeter has told senior bankers that he was done with their complaints about pay. “You just don’t get it,” he told thousands of bankers on more than one recent call, according to bankers who were on the call. “He told us that bankers are spoiled children and we’re the ones who messed this place up,” said one senior banker who recently left the firm. “You would get off the calls and think, ‘how can I stay here any longer?’”

So, actually not quite sure what to make of this. On the one hand, people should be compensated for the work they do, especially those who didn’t contribute to the multi-billion dollar losses. On the other, UBS did fuck up, and not in a small way, and perhaps a little slap in the face to jolt everyone back to reality is warranted?
At UBS, Complaints And Exits [WSJ]

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For any banks looking to do the same, officials describe their complaint against the Swiss bank as a “how to guide for bid-rigging and securities fraud.”

The SEC alleges that during the 2000 to 2004 time period, UBS’s fraudulent practices and misrepresentations undermined the competitive bidding process and affected the prices that municipalities paid for the reinvestment products being bid on by the provider of the products. Its fraudulent conduct at the time also jeopardized the tax-exempt status of billions of dollars in municipal securities because the supposed competitive bidding process that establishes the fair market value of the investment was corrupted. The business unit involved in the misconduct closed in 2008 and its employees are no longer with the company.

According to the SEC’s complaint filed in U.S. District Court for the District of New Jersey, UBS played various roles in these tainted transactions. UBS illicitly won bids as a provider of reinvestment products, and also rigged bids for the benefit of other providers while acting as a bidding agent on behalf of municipalities. UBS at times additionally facilitated the payment of improper undisclosed amounts to other bidding agents. In each instance, UBS made fraudulent misrepresentations or omissions, thereby deceiving municipalities and their agents.

“Our complaint against UBS reads like a ‘how-to’ primer for bid-rigging and securities fraud,” said Elaine C. Greenberg, Chief of the SEC’s Municipal Securities and Public Pensions Unit. “They used secret arrangements and multiple roles to win business and defraud municipalities through the repeated use of illegal courtesy bids, last looks for favored bidders, and money to bidding agents disguised as swap payments.”

According to the SEC’s complaint, UBS as a bidding agent steered business through a variety of mechanisms to favored bidders acting as providers of reinvestment products. In some cases, UBS gave a favored provider information on competing bids in a practice known as “last looks.” In other instances, UBS deliberately obtained off-market ”courtesy” bids or arranged “set-ups” by obtaining purposefully non-competitive bids from others so that the favored provider would win the business. UBS also transmitted improper, undisclosed payments to favored bidding agents through interest rate swaps. In addition, UBS was favored to win bids with last looks and set-ups as a provider of reinvestment products.

SEC Charges UBS with Fraudulent Bidding Practices Involving Investment of Municipal Bond Proceeds [SEC]
SEC v UBS Complaint [SEC]

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Back in February, we noted that UBS was mulling a move out of the I-95 palace it’s inhabited since the 90s; later, were were told the bank had informed employees that Equity sales and trading would be moving to New York, while the rest of the floor would remain in the Stamford Superdome, at least for now. Stamford Mayor Michael Pavia apparently received similar intel at the time “causing him to take the rumors seriously.” And just last week, State House Minority Leader Lawrence Caferno (R-Norwalk) was informed by well-placed sources that UBS has one and half feet out the door. “Their plan is they’re moving their trading floor. They’re gone,” Cafero told Greenwich Time. “It would be so sad and devastating on so many levels.” Why is UBS doing this to Big Lar? According to the Swiss, they’re not, and his late-night crying jags are for naught.

UBS spokesman Kelly Smith last week told Hearst Connecticut Media Group, “We’re not leaving Stamford. It’s not true. I don’t know why this rumor started but it’s a not true rumor.”

And yet, that’s what people are saying, including, allegedly, UBS, which one employee said sent out an official memo about the Equities move a few weeks ago. “Not sure why everyone’s beating around the bush on this,” said employee wondered aloud. Ideas re why bush is being beaten that come to mind include: a) UBS really isn’t leaving Stamford entirely, just Equities, and doesn’t get why that’d be such a big deal b) UBS isn’t leaving Stamford at all, and is just floating the Equities rumor to employees to test people’s loyalty or c) UBS isn’t leaving Stamford at all but would rather not confirm that to state officials until they can work a few things out.

In 1997, UBS — then known as Swiss Bank — lured by tens of millions of dollars worth of interest-free loans and tax credits, moved its North American operations from New York City into a 565,000-square-foot building in downtown Stamford. The structure’s highlight is a two-football-field-sized trading floor considered the largest in the world. At least some of the incentives, finalized in 2001, expire this year in part because UBS met a first phase, 2,000-job threshold, but not phase-two requirements, including construction of an office tower to house 4,000 employees.

[Greenwich Time]

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Exciting news for second year associates up through directors.

“2nd year associates up to directors all got raises today. 2nd year associates went from 130 to 140; 3rd year associates from 140 to 160.”

Those are all the numbers we have for now; if you got a bump, feel free to share with the group.

Article courtesy of Dealbreaker

We’re told four UBS employees were pulled out of the Stamford office Tuesday, after two of them returned from vacation. Apparently all four “worked in operations and were responsible for securities movements and payments.”

It’s unclear at this time what happened. A “major meeting was held yesterday with senior MD’s to asses the damage.”

If you know of any other details, or if this was a Jim Glover-esque incident, do get in touch.

Article courtesy of Dealbreaker

As you may have heard, UBS has been going through a bit of a rough patch. Despite posting an annual profit (of 7.2 billion Swiss francs) for the first time since 2006, things just haven’t been the same since the crisis, and some are suggesting it never will be, writing that the bank “doesn’t have a chance” getting back to pre-crisis levels because “too much damage has been done.” Not helping things is the fact that there’s been very high turnover in the last couple months, which may have something to do with the fact that people have a need to get paid.

The last two months have seen a large turnover of staff and an overhaul of management at the top. In the last month alone, a new global head of securities, the co-head of fixed-income, currencies and commodities, and a top deal maker in Asia, traditionally a strong region for UBS, have all left. At the same time, the bank has announced new leadership for the crucial M&A business and new chiefs for investment banking for the Americas, Asia and Europe, among other changes. Just this week, UBS lost the head of its prime brokerage unit in Asia, as well as the co-head of its Asian industrials banking team.

UBS is struggling to pay enough to keep top talent as it works on the revamp, say headhunters and former UBS bankers, with some senior bankers not having received a bonus in several years. And while UBS paid dearly to attract a few heavy hitters, overall pay is too low to keep staff from jumping ship, they say. In February, the bank delayed by a week the announcement of bonuses while it reworked its plan to try to prevent bankers from leaving.

Not saying no one at UBS will ever get paid again but in order to account for a worst case scenario, let’s just say that. Any ideas how management can entice people not to quit/take a gig with them? As the Swiss are getting desperate, you could probably suggest just about anything and they might give it a shot. What if they could guarantee a guy pulling up to the Stamford office in a white Civic and demanding to speak to “the President” while brandishing a baseball bat at least once a week? Would that be something you’d be interested in? (That might do it for me.)

Signs Of Strain At UBS Investment Bank [WSJ]

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Late last evening, Senator Carl Levin released a report of his investigation into the financial crisis entitled “Wall Street And The Financial Crisis: Anatomy Of A Financial Collapse.” The majority of the blame goes toward investment banks, particularly Goldman Sachs (described by Levin- no relation- as “a financial snake pit rife with greed, conflicts of interest, and wrongdoing”), as well as Deutsche Bank, whose former trader, Greg Lippmann (he of “I’m short your house” and sushi spreadsheet fame) gets a lot of airtime. Also criticized are the ratings agencies, who Levin says “weakened their standards as each compete to provide the most favorable rating to win business and greater market share.” To that end, the Senator from Michigan illustrates his point with a story about Standard & Poor’s and UBS.

In this anecdote, the characters are two S&P analysts, James Yao of UBS, Vertical ABS CDO 2007-1, and an attitude the ratings agency did not appreciate.

Oh yeah, the analysts were pissed something fierce and they had a right mind to tell James to go fuck himself. Nobody pushes Standard & Poor’s around! Unless you’re paying in which case, do whatever you want to us and we’ll go along with it.

But just know that we will be having a conversation internally about how your attitude needs adjusting or else something will be done. Seriously. Take this threat seriously. We’re serious. Going to stop talking now so I can put this ball gag in my mouth like you asked but remember what we said.

Article courtesy of Dealbreaker

The good news is it has nothing to do with tax evasion. The bad news is the bank may have manipulated Libor rates.

UBSsaid it received subpoenas from U.S. authorities investigating possible attempts to manipulate the setting of the London interbank offered rate.

The company received subpoenas from the U.S. Securities and Exchange Commission, the U.S. Commodity Futures Trading Commission and the U.S. Department of Justice, Zurich-based UBS said in its 2010 annual report published today. The bank also received an order to provide information to the Japan Financial Supervisory Agency concerning “similar matters,” it said.

“UBS understands that the investigations focus on whether there were improper attempts by UBS, either acting on its own or together with others, to manipulate Libor rates at certain times,” the bank said. “UBS is conducting an internal review and is cooperating with the investigations.”

But hey, did you hear? No new tax evasion charges!

UBS Says U.S. Authorities Are Investigating Possible Manipulation of Libor [Bloomberg]

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