Ex-UBS Official Lied About Using Burner Phone With Trader
(Bloomberg) -- A former UBS Group AG compliance officer admitted that she’d lied to prosecutors when she told them she hadn’t used burner phones to communicate with a day trader who’s her co-defendant in an insider trading trial in London.
Fabiana Abdel-Malek said she’d panicked and tried to dissociate herself from her friend Walid Choucair under questioning at a police station. She’s accused of leaking price-sensitive tips from a UBS deals database to Choucair, allowing him to profit from the information.
“I figured out that the pay-as-you-go was the link and I got scared, I freaked out,” the 36-year-old said on her third day of testimony at a London trial. “I hadn’t forgotten. They were lies.”
The trial is the Financial Conduct Authority’s first insider-trading case in three years. Abdel-Malek and Choucair, 40, were each charged by the U.K. regulator with five counts of insider dealing between June 2013 and June 2014. The FCA says Choucair made 1.4 million pounds ($1.8 million). They have both pleaded not guilty.
The two messaged each other as much as 50 times a day on the phones, Abdel-Malek said.
The former compliance officer, who said she now felt “very stupid” about lying, said she was initially "a bit startled" when Choucair handed her a pay-as-you-go handset. She said that he told her that it was the way he liked to manage or separate his friends and contacts. Even his mother had a burner phone, he told her.
She said that she didn’t consider it suspicious.
The handover of the phone came around the time that Abdel-Malek moved jobs within UBS to the equity compliance department at the investment banking unit, John McGuinness, a lawyer for the FCA, said. It was also a turnaround from their previous contact, when Choucair had asked Abdel-Malek to stop calling him so often, she said.
The phone was a Nokia -- something she said she complained about within a month -- before Choucair replaced it with a BlackBerry.
"It was embarrassing to walk around with a Nokia in this day and age," Abdel-Malek said. "I thought, ‘I’m not going to use this.”’
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