100 Percent Principal Protected Note Investors Could Recover Losses

by InvestorLawyers on August 1, 2013

in Arbitration,FINRA,Lehman Brothers,Lehman Principal Protected Notes,Suitability,UBS

Investment fraud lawyers are currently investigating claims on behalf of customers of UBS Financial Services who were sold 100 Percent Principal Protected Notes. 100 Percent Principal Protected Notes were bonds or structured notes issued by Lehman Brothers Inc. Lehman Brothers declared bankruptcy in September of 2008, resulting in disastrous losses for many investors.

100 Percent Principal Protected Note Investors Could Recover Losses

Recently, a Financial Industry Regulatory Authority arbitration claim was filed on behalf of a Texas investor against UBS Financial Services. According to the Statement of Claim, UBS Financial Services allegedly sold the investor, who was a brokerage customer of the firm at the time, $300,000 of the 100 Percent Principal Protected Notes.

According to the claim’s allegations, UBS was aware of the deteriorating financial condition of Lehman Brothers, but concealed its views from brokerage customers who owned the notes. Furthermore, UBS customers were allegedly kept unaware that the Lehman Brothers notes could quite possibly default and become worthless. In addition, the claim alleges that the sales of Lehman notes were halted twice by UBS Financial Services because of concerns regarding credit risk, but UBS did not disclose these halts to thousands of its customers who were already invested in Lehman notes.

In addition to the alleged failure to disclose relevant information to its customers, securities arbitration lawyers say that many investors may have received unsuitable recommendations of the Lehman Brothers 100 Percent Principal Protected Notes and other Lehman Brothers structured products. Financial Industry Regulatory Authority rules have established that firms have an obligation to fully disclose all the risks of a given investment when making recommendations, and those recommendations must be suitable for the individual investor receiving the recommendation given their age, investment objectives and risk tolerance. Furthermore, investment fraud lawyers say brokerage firms must, before approving an investment’s sale to a customer, conduct a reasonable investigation of the securities and issuer.

Investors should be aware that the Financial Industry Regulatory Authority imposes a six-year time limitation for filing arbitration claims.  Therefore, investors who purchased Lehman Brothers structured products in late 2007 or early 2008 should consider consulting an attorney as soon as possible if they wish to explore filing a claim.

If you are a UBS Financial Services customer who suffered significant losses in Lehman Brothers products, you may have a valid securities arbitration claim. To find out more about your legal rights and options, contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C.  at (866) 966-9598 for a no-cost, confidential consultation.

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