Former-UBS banker pleads guilty to rigging bids

21 May 2010

A banker previously employed by Swiss bank UBS has pleaded guilty to charges of conspiring to rigging bids related to proceeds surrounding municipal bonds and contracts.

According to the US Justice Department, Mark Zaino admitted to separate charges of fraud conspiracy, bid rigging and wire fraud.

Unnamed sources were cited by newspaper reports which said that although UBS is not named in the government filing, Mr Zaino worked on the municipal bond desk at the firm during the period in which the crimes were perpetrated.

The former banker worked on investment contracts as a broker and decided in advance which co-conspirator would win a particular bid.

Others would then submit losing bids in an attempt to show that the process had been competitive, the filing explained.

In a statement, the government department said: “According to the court documents, kickbacks in the form of inflated or unearned fees were paid to Zaino's employer and its parent financial institution in exchange for assistance in controlling the bidding process and ensuring that certain co-conspirator providers won the bids they were allocated.”

Mr Zaino is thought to be the fourth person to plead guilty in an ongoing investigation by US authorities into fraud committed within the municipal bonds industry.

By Jim Ottewill

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