Consumers were faced with the recession due to the credit crisis and have long seen the banks as the culprit in their long standing climb out of a financial mess.  Banks quickly began seeing profits once more and the officers began boosting their bonuses.  Consumers meanwhile have continued to face difficulty in finding lending and the housing market has nearly stalled.  Now it has been revealed that UBS has lost an estimated $2 billion (1.2 billion pounds) through unauthorized trades by one trader.  This must be hard to swallow by those that have been turned down for remortgages, mortgages, and small business loans to continue on in their lives toward the dreams of business or home ownership. 

Kweku Adoboli, a trader with UBS is alleged to have made unauthorized trades that resulted in a major loss of assets by UBS.  However the loss is expected to be well handled by the bank as they are thought to have enough capital to handle such a massive loss.  It is expected however that the profits of their investment banking operations will be hard hit resulting in a lack of bonuses for UBS officers.  Last month UBS announced they would be cutting 3,500 jobs and now there is expectation the number could be higher due to the recent scandal.

The investigation of the unauthorized trades by UBS is likely to take months.  There will be more job cuts and an overhaul of not only UBS but of other banks as well once they begin looking into their own departments to insure this kind of thing isn’t possible for them.  The impact will trickle down to consumers as most financial problems are by big business and what toll it takes will take time to see.  Meanwhile, there will be more unemployment for sure and a further tightening of lending, both of which were unneeded in today’s economy.  Consumers will now have even less of a reason to have confidence in banking businesses.