UBS Allegedly Made Unsuitable Recommendation of Lehman Structured Products

by InvestorLawyers on July 18, 2013

in Arbitration,FINRA,Securities Fraud,Suitability,UBS

Investment fraud lawyers are currently investigating claims on behalf of investors who suffered significant losses as a result of the unsuitable recommendation of Lehman structured products. Recently, a securities arbitration claim was filed on behalf of a couple who did business with UBS Financial Services Inc. The FINRA arbitration was filed against UBS Financial Services and alleges the improper and unsuitable sale of Lehman structured products.

UBS Allegedly Made Unsuitable Recommendation of Lehman Structured Products

According to the Statement of Claim, the couple was nearing retirement and, therefore, wanted to preserve and protect their savings. Allegedly, they were presented with a written financial plan by UBS Financial Services that recommended an allocation of 52 percent equities and 46 percent fixed income for their “moderate” objectives and risk tolerance.

However, securities arbitration lawyers say the claim alleges that UBS disregarded the recommended allocation and concentrated the couple’s accounts in structured products and notes and equities for the “fixed income” portion. These investments allegedly included Lehman structured products, which UBS was aware carried significant default risk.

The claim also alleges that, unlike traditional fixed income investments, the structured products failed to provide principal protection or diversification, making their sale to these investors unsuitable. Allegedly, UBS sold these structured notes in order to generate fees.

According to investment fraud lawyers, 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.

If you are a UBS Financial Services customer who suffered significant losses because of an unsuitable recommendation of an investment product that was too risky for your investment objectives and risk tolerances, you may have a valid securities arbitration claim. Under FINRA rules investors must make claims within six years of the event or occurrence underlying the claim. Therefore, investors who purchased Lehman structured products in late 2007 and 2008 should consider consulting an attorney as soon as possible if they wish to possibly pursue a claim.   To find out more about your legal rights and options, contact a securities arbitration lawyer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.

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