UBS became aware in September 14 2011, that unauthorised trading had taken place on the Exchange Traded Funds Desk in the Global Synthetic Equities (GSE) trading division in London.
Rogue trader Kweku Adoboli had disguised the underlying positions by the use of late bookings of real trades and the booking of fictitious trades.
In an email sent to chartered accountant William Steward he revealed the £1.4 billion losses he had caused.
It is with great stress and disappointment that I write this mail. First of all the ETF (Exchange Traded Funds) trades that you see on the ledger are not trades that I have done with a counterparty as I previously described.
I used the bookings as a way to suppress the PnL (profit and loss) losses that I have accrued through off book trades that I made.
I take full responsibility for my actions and the s*** storm that will now ensue. I am deeply sorry to have left this mess for everyone and to have put my bank and my colleagues at risk.
Kweku Adoboli was working on complex trades in a culture that promised big returns.
Crucially, he had experience working in UBS' backroom operation - this is where the checks and balances take place.
Like Nick Leeson, who brought down Barings Bank 17 years ago, he knew how to hide his fake trades.
There are still many questions about UBS management and how they managed to miss such vast sums: at one stage, the potential losses were £7 billion, double what the bank made in profit the year before all this kicked off.
Could this happen again? Not this specific trade, because the banks know about it now. And there is some evidence that the culture is changing.
But one bank observer told me this evening that he could guarantee there would be new loopholes to exploit and, as a result, more trade crimes.
Andrew Penhale, deputy head of fraud at the Crown Prosecution Service (CPS) said Kweku Adoboli had simply acted dishonestly, and his fraudulent actions had impacted "hugely" on a large number of people. He said:
"The amount of money involved was staggering, impacting hugely on the bank but also on their employees, shareholders and investors. This was not a victimless crime."
He [Kweku Adoboli] did so by breaking the rules, covering up lying. His actions amounted to fraud, the amount of money was staggering... This was not a victimless crime. People who commit fraud in any walk of life should know that the technicality of the case is not a barrier to bringing it to justice.