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Articles Tagged with Puerto Rico

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The Problem: Investors have reported that financial advisors in Puerto Rico, especially those at UBS Puerto Rico, sold them closed-end funds based on the representation that the funds paid a steady yield of income, but were safe and that investors’ money was not at risk because of the secure municipal bonds backed by the Puerto Rico government in which the funds invested. Some of these UBS Puerto Rico closed-end funds have lost over half their value in a period of only 2 months.

Sold As Safe Many investors report that UBS and other brokerage firms in Puerto Rico sold these funds to investors as safe fixed-income investments. Of course, they have proved to be anything but safe, and many investors have lost much or even all of their retirement savings.

Dangerous Borrowings Against Accounts: Many investors who needed to withdraw money from their accounts for personal reasons (such as to purchase a home or fund a child’s education) have reportedly been advised to borrow money from UBS and other brokerage firms instead of selling shares in UBS Puerto Rico funds. This was very dangerous advice, because if the funds lost value, the investor’s losses would be even greater than they otherwise would have been due to the borrowings. Now that the funds have lost value, some investors have lost almost all of their investments, or even ended up owing the brokerage firms money!

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