MIAMI, April 12, 2011 (GLOBE NEWSWIRE) -- The securities law firm of Dimond Kaplan & Rothstein, P.A. ( or ) alerts UBS customers who bought Lehman Brothers principal protection notes that the Financial Industry Regulatory Authority (FINRA) has fined UBS Financial Services, Inc. $2.5 million and required UBS to pay $8.25 million in restitution. Among other things, UBS was fined for misleading investors about the "principal protection" feature of 100% Principal-Protection Notes (PPNs) issued by Lehman Brothers Holdings Inc. FINRA's fine of UBS follows similar charges levied against UBS by New Hampshire securities regulators.
UBS sold Lehman Brothers principal protection notes as a safe security that would protect investors' money, but UBS failed to emphasize or even disclose that the Lehman principal protection notes were nothing more than unsecured debt of the financially troubled Lehman Brothers, and that the securities actually subjected investors' money to significant risk of loss. FINRA found that UBS did not adequately address the vitally important fact that the credit risk of the financially unsound Lehman Brothers could result in a total loss of principal.
FINRA also found that UBS:
a. did not provide UBS brokers with proper guidance on how to advise clients about certain facts affecting the risk of the Lehman Brothers securities;
b. failed to establish an adequate supervisory system for the sale of the Lehman-issued principal protection notes, and failed to provide sufficient training and written supervisory policies and procedures;
c. did not adequately analyze the suitability of sales of the Lehman-issued principal protection notes to certain UBS customers; and
d. created and used advertising materials that had the effect of misleading some customers about specific characteristics of PPNs
While UBS neither admitted nor denied the charges when it consented to the entry of FINRA's findings, the evidence appears to be overwhelmingly in favor of investors and against UBS. Indeed, FINRA arbitrators have awarded money to a number of investors already.
"The manner in which UBS sold Lehman PPNs appears to have violated UBS's most basic legal obligation to fully and fairly disclose to investors all material facts about the securities," said Dimond Kaplan & Rothstein, P.A. attorney Jeffrey Kaplan. "Documents that we have discovered during the course of our representation of Lehman PPN investors reveal that there were significant material facts about which UBS never informed investors," said attorney Kaplan.
Dimond Kaplan & Rothstein, P.A. is an AV-Rated law firm that represents investors in stockbroker fraud and investment loss cases. If UBS sold you a Lehman Brothers principal protection note or a Lehman Brothers structured product, please contact Jeffrey Kaplan, Esq. of Dimond Kaplan & Rothstein, P.A. at (888) 578-6255 or firstname.lastname@example.org for a free case evaluation. Our law firm represents numerous investors throughout the United States and Latin America who lost money in Lehman structured products. You also may visit the firm on the web at or .
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