UBS rogue trader was warned about SocGen scandal, court told LONDON (Reuters) - Ex-UBS (UBSN.VX) trader Kweku Adoboli was warned by the Swiss bank about a "rogue trading" scandal at France's Societe Generale years before he was charged with fraud over losses of $2.3 billion at UBS, a London court heard on Tuesday. Along with all other employees of UBS's investment banking arm at the time, Adoboli was sent an email in January 2008 after SocGen announced losses of 4.9 billion euros ($7.1 billion) blamed on unauthorized trades by Jerome Kerviel. Adoboli, 32, used to work as a senior trader on the Exchange Traded Funds (ETFs) desk at UBS's London offices. He was arrested on September 15, 2011 and is now on trial accused of fraud and false accounting, charges he denies. The prosecution presented as evidence to the jury an email sent by UBS's internal communications team to all investment bank staff on January 25, 2008, reacting to SocGen's announcements about the Kerviel affair. The email, entitled "Global compliance alert: rogue trader costs Societe Generale $7.1 billion," told staff that the case was a "sobering reminder" of the importance of effective supervision. "The trader, who exceeded his limits, was able to conceal the positions in plain vanilla index futures through 'a scheme of elaborate fictitious transactions' because of his 'in-depth knowledge of the control procedures resulting from his previous employment in the middle office'," the UBS email said, citing SocGen announcements. Adoboli, who worked in the back office at UBS for just over two years before becoming a trader, has been accused by prosecutors of far exceeding his risk limits and of concealing his huge positions with fictitious bookings into the accounts. His defense team have argued that risk limits were loose and supervision inadequate, that senior management at the time were encouraging greater risk-taking to achieve greater profits, and that others within UBS knew of and condoned Adoboli's methods. The January 2008 email sent to UBS staff contained an attachment entitled "Red Flags" alerting employees to signs of possible problems that they should report. Under the heading "trading activity," the red flags included a trader exceeding risk limits, unusually large trading volumes, and a pattern of late or amended bookings of trades. The prosecution in Adoboli's case have said that he used extended settlement dates and amendments or cancellations of bookings as part of his methods to conceal his true trading positions from the bank. UBS sent another email to staff about the SocGen case on October 19, 2010, after the French trader was sentenced to five years in jail and to a 4.9-billion-euro fine for forgery and breach of trust. In that email, which was read out to the jury in Adoboli's trial, the Swiss bank told staff that the case showed there could be serious personal liabilities for those who breached the rules. UBS also said it would not tolerate any violations of its code of conduct, and asked supervisors to be alert to any red flags. The trial continues on Thursday, when the prosecution are expected to conclude their case and Adoboli is expected to take the stand in his defence. Created by Estelle Shirbon