Walls Street’s brokerage regulator has ordered UBS to pay $10.75 (SFr9.69 million) to settle charges it misled customers about the risk of owning Lehman Brothers debt.
This content was published on
1 minute
swissinfo.ch and agencies
The Financial Industry Regulatory Authority (Finra) said the Swiss bank agreed to pay a $2.5 million fine and reimburse its customers $8.25 million. UBS did not admit or deny any wrongdoing in agreeing to settle.
Finra said UBS and its brokers failed between March and June 2008 to emphasise that payment was not guaranteed on a certain category of Lehman’s debt, sold as “100% principal-protection notes”.
UBS sold $16.2 million of these notes in the three-month period from mid March 2008, after Bear Stearns was acquired by JP Morgan Chase in a US government-backed rescue, a time of financial turmoil on Wall Street. Lehman Brothers went bankrupt on September 15, 2008.
The notes were sold to 764 unique accounts with “conservative” to “moderate” risk profiles and UBS generated $228,630 in fees and commissions on these sales, Finra said.
Lehman’s bankruptcy, the largest in US history, wiped out the value of the notes and sparked a wave of arbitration claims by investors.
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.
Read more
More
UBS bosses boost share of shrinking bonus pot
This content was published on
Chief Executive Oswald Grübel again waived his bonus and the bank’s top earner saw his pay slashed with a greater portion of variable pay hinging on long-term targets. But some staff and shareholders remain unimpressed. With political and public pressure on “fat cat” bonuses showing little sign of relenting, the announcement of UBS’s compensation statistics…
This content was published on
The renewed offensive by the US tax authorities has alarmed the Swiss banking community, sparking fears of a second assault on banking secrecy and rumours regarding which banks may be next to face the music. One bank that has suffered from adverse conditions in the US is the Neue Zürcher Bank (NZB), that closed down…
This content was published on
Efforts by the Swiss authorities to purge the financial centre of ill-gotten gains, following the UBS debacle, have failed to deter countries from pursuing aggressive legal measures against other banks. The US indictments on Thursday follow the arrest of another Credit Suisse employee and – in a separate case – another raid by the German…
This content was published on
On Thursday, parliament sealed the deal allowing the United States access to confidential UBS data on bank clients suspected of tax evasion. “Reason has prevailed after all,” is how the Neue Zürcher Zeitung (NZZ) put it, saying that Switzerland now has a chance to demonstrate its reliability as a partner for the US. Fribourg’s La…
You can find an overview of ongoing debates with our journalists here . Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.