UBS entered into a Letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA). UBS was alleged to have failed to reasonably supervise its brokers and have an adequate supervisory system in place to address short positions in tax-exempt municipal bonds that resulted from trading errors at firm branches. Because of these supervisory failures, UBS inaccurately represented approximately 4,731 customers that at least $1,165,000 in interest that the firm paid to those customers was exempt from taxation. The firm did not hold the bonds on behalf of the customers and the interest that the customers received was paid by UBS and thus taxable as ordinary income. Allegedly, UBS failed to consider whether the interest it paid to customers should be coded as non-taxable when the interest was paid by the firm rather than the municipal issuer. For this, UBS was censured and fined $750,000.
If you invested money with UBS, you may be entitled to recover some of your investment losses. Please call our securities law office at 312-332-4200 to speak with one of our attorneys. We sue firms such as UBS in the FINRA arbitration forum to help investors recover their losses. The call is free with no obligation. We take cases on a contingency fee basis only.
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