UBS Tightens Rules on Staff Trading for Personal Accounts
Oct. 9 (Bloomberg) — UBS AG is tightening its rules on how employees can trade securities for personal accounts, telling staffers it wants to prevent potential abuses.
The Swiss bank would be at least the third global lender to reconsider its conflict-of-interest policy for personnel who wish to invest for themselves, as opposed to for their clients. Citigroup Inc. and Goldman Sachs Group Inc. have taken similar steps, people with knowledge of the developments said last month.
The changes follow assertions by a former regulator for the Federal Reserve Bank of New York that she was fired from her job after concluding that Goldman Sachs’s policy was not in compliance with Fed rules. Banks monitor staff investments to prevent insider trading and to counter claims that they put the interests of employees ahead of clients. The New York Fed ’’categorically’’ rejected the assertions.
Starting January, UBS employees will ’’not be allowed to open new investment or trading positions with anyone other than approved brokers. You will be allowed to liquidate existing positions,’’ Ulrich Koerner, chief executive officer for Europe, the Middle East and Africa, told staff yesterday in a memo obtained by Bloomberg News.
’’The goal is to prevent potential abuses and avoid risk to our reputation,’’ his memo states.
UBS said in an e-mailed statement today that the new rules are becoming more common in the industry and will strengthen protection of the bank and its employees.
Goldman Sachs told employees on Sept. 26 that it was barring investment bankers from owning individual securities, a person with direct knowledge of the matter said at the time. Previously Goldman Sachs required bankers to get approval before they could trade individual securities.
Citigroup will review its conflict-of-interest policy for investment bankers, a person knowledgeable about that bank’s situation said on Sept. 30.
The changes at UBS were first reported today by Swiss newspaper Neue Zuercher Zeitung.
To contact the reporter on this story: Jeffrey Vögeli in Zurich at jvogeli@bloomberg.net To contact the editors responsible for this story: Elisa Martinuzzi at emartinuzzi@bloomberg.net Cindy Roberts
