What Did Your Brokerage Firm or Investment Adviser Do Wrong With GWG
Published On: August 2, 2022

Chicago-based Stoltmann Law Offices is representing investors who’ve suffered losses from investing in options strategies that went wrong. Along those lines, an arbitration panel recently ordered UBS to pay more than $1.4 million to a husband and wife who accused the bank of misrepresenting a complex YES options trading strategy that tanked, according to barrons.com.

“Dozens of investors have filed arbitration claims against UBS for alleged misrepresentations in how the strategy was marketed and implemented. A customer has also filed a lawsuit against the company seeking class action status,” Barrons reported. UBS, which has previously denied the allegations, has won some arbitration cases, but lost others.

Approximately 1,500 customers participated in the YES strategy. Assets invested in YES accounts ballooned to $5.7 billion in December 2018, according to the lawsuit seeking class action status. The strategy suffered substantial losses totaling about $1.2 billion, according to the lawsuit.

Like many opaque investment programs, YES was lucrative for broker-advisors, but poorly performing for investors, most of whom didn’t understand the downside risk or complexity of the derivatives strategy. YES was pitched as a way of making money during volatile markets, but it had the opposite result.

UBS also has been ordered to pay nearly $25 million by the Securities and Exchange Commission (SEC) on allegations of fraud connected with the YES program, which was originally “designed to lower exposure during times of market volatility and involved the placement of several options trades at varying strike prices, all with the same date of expiry,” according to ABS Market Research. “However, beginning in December 2018, investments under the strategy suffered significant losses.”

Last year, arbitrators ordered UBS to pay nearly $371,000 to a pair of investors in Ohio who brought a claim over losing money in the YES program. The claimants, Matthew V. Fisher and Lisa G. Fisher, requested a total of $1.67 million in damages and accused the firm of mis-marketing the product as low risk in breach of fiduciary duty and Ohio state securities laws. They first filed their case in Columbus, Ohio, in September 2019, according to Advisorhub.com. Investors lost money in the YES strategy “amid volatile equity markets in late 2018 and 2019 and then again amid the pandemic volatility in 2020,” Advisorhub noted.

If you invested with a broker-advisor and lost money as a result, you may have a claim to pursue through FINRA Arbitration. Please contact Stoltmann Law Offices, P.C. at 312-332-4200 for a free, no obligation consultation with a securities attorney. Stoltmann Law Offices is a contingency fee law firm which means we do not get paid until you do!


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