The U.S. Securities and Exchange Commission has fined UBS Financial Services Inc. $3.5 million, settling UBS overcharge claims. The case against UBS claims the bank overcharged retirees and charities for mutual funds. According to filings, the 15,250 customers collectively paid $18.5 million in excessive costs.
UBS Misleads Customers
From January 2010 through June 2015, the SEC claims that UBS misled customers, not disclosing information that could have effected customers’ investment decisions.
According to the SEC, UBS did not tell customers that they were eligible for less expensive mutual funds shares or that UBS would make more money off of the more expensive fund shares. UBS also allegedly did not disclose that customers’ purchases of the more expensive share classes would negatively impact the overall return on their investments, especially when related to the different fee structures for less expensive fund share classes.
UBS Takes Settlement Action
Under the settlement agreement, UBS issued payments with interest to affected customers and converted eligible customers to the mutual fund share class with the lowest expenses for which they are eligible. This was done at no cost to customers.
As of publishing, 970 customers had not cashed or deposited their payments, or changed their addresses. The SEC said that UBS will continue attempts to find these customers.
UBS Repeat Regulatory Offender
In the past three years, UBS has paid several SEC fines for violation of securities laws. In January 2015, the firm settled a $14.4 million sanction from the SEC for operating dark pools and providing an unfair advantage to high-frequency traders.
In October of that same year, UBS agreed to pay $20 million to settle SEC claims regarding misleading statements when offering structured notes to retail investors. And most recently, the SEC announced a $15 million settlement with UBS AG over allegations that the bank failed to properly train staff regarding complex financial products sold to retail investors. Moreover, within the last several years, the SEC, FINRA, and Puerto Rico securities regulators collectively have levied approximately $40 million in penalties and fines on UBS relating to UBS’s
recommendations and sales of over-concentrated positions in Puerto Rico bond funds, improperly recommending loans that were collateralized by the risky Puerto Rico funds, and improper supervision over Puerto Rico brokers who sold the risky Puerto Rico bond funds.
Have You Lost Money Investing with UBS?
If you believe you have lost money investing with UBS or have been the victim of stockbroker misconduct, you may have certain legal rights that require your immediate attention.
Call an Investment Fraud Attorney Today
If you are looking for an securities fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerage firms for their wrongful actions.