(Fixes headline to reflect that incidents disclosed in court)
By Estelle Shirbon
LONDON, Oct 18 (Reuters) - UBS managers have sacked two traders involved in unauthorised trading incidents unrelated to accused fraudster Kweku Adoboli, a London court heard on Thursday.
In a separate strand of evidence heard at Adoboli's trial, the jury heard that an internal UBS probe into his trades had found "strong evidence of collusion at local desk level".
Adoboli, 32, faces two counts of fraud and two of false accounting, which he denies. He has been blamed for losses of $2.3 billion that were announced on Sept. 15, 2011, the day he was arrested.
Information about three separate and previously unheard-of unauthorised trading incidents emerged during the cross-examination of Colin Bell, UBS's global head of operational risk control.
Without disclosing details of the three incidents or revealing when they occurred, Bell told the court that two out of the three traders concerned had been dismissed. The third still worked at the Swiss bank.
The matter was raised by Adoboli's defence lawyer Charles Sherrard as part of a broader strategy to present UBS as a bank with sloppy compliance systems.
Asked whether the incidents that had led to the two dismissals had resulted in losses to the bank, Bell said there had been "an element of restating of perceived profit and loss".
Bell added that he would "draw a distinction" between the three incidents and the case of Adoboli.
He said that one example of an incident that would be termed "unauthorised trading" could be where someone mandated to trade a particular product had traded a different one.
Bell said this did not "fall into the same bucket" as the Adoboli case, in which the core accusation is that the trader exceeded his risk limits and concealed his huge, unhedged positions with fictitious bookings.
Citing a document by KPMG, the auditors who investigated events at Adoboli's Exchange Traded Funds (ETFs) desk, Sherrard said UBS had alerted the Swiss and British financial regulators about the three incidents.
UBS as well as the regulators had asked KPMG not to assess the three incidents as part of their in-depth probe into the Adoboli case, the KPMG document said.
Earlier in Thursday's hearing, Sherrard read out excerpts from an internal UBS report, dated Dec. 9, 2011, on what had gone wrong on the ETFs desk.
"The supervision of the ETFs trading activity ... was ineffective," the report said.
"A director-level peer of Kweku Adoboli was allocated supervisory responsibility for the desk and their mutual line manager was based in the U.S.," it said.
This was a reference to John Hughes, the other senior trader on the ETFs desk, and John DiBacco, the New York-based manager who took over responsibility for the London-based desk in April 2011.
Both Hughes and DiBacco were dismissed from UBS in the wake of Adoboli's arrest, and both have appeared as witnesses at his trial.
"The supervisor (Hughes) had never completed supervisory training despite being invited to attend 17 times by compliance," the internal report said.
"Nevertheless, there is strong evidence of collusion at local level ... The local supervisor was aware of Mr Adoboli's propensity to smooth profit and loss and to take unacceptably high levels of net delta (risk)," it said.
Adoboli's defence team have argued that he believed he was acting for the good of the bank and that others, especially Hughes, knew what he was doing and were complicit to a certain extent.
The prosecution has presented him as a lone "rogue trader", out of control and out for himself.
The trial continues. (Writing by Jon Hemming)