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Home / Insurance / UBS pays $ 25 million to settle SEC fraud charges

UBS pays $ 25 million to settle SEC fraud charges



(Reuters) – The asset manager and banking group UBS will pay $ 25 million to settle fraudulent fees related to an options trading strategy, the US Securities and Exchange Commission said on Wednesday.

UBS marketed and sold the “Yield Enhancement Strategy (YES)” to approximately 600 investors through its platform of domestic financial advisers from February 2016 to February 2017, the SEC said, adding that its order found that UBS did not provide its financial advisers with adequate training and supervision in strategy.

Although UBS acknowledged and documented the possibility of significant risk in these investments, they failed to share this information with advisors or clients, the SEC said in a statement.

“As a result, the order states, some of UBS̵

7;s advisers did not understand the risks and could not form a reasonable belief that the advice they gave was in the best interests of their customers,” the statement added.

Without acknowledging or denying the SEC’s conclusions, UBS agreed to a termination order, a no-confidence motion and to pay $ 5.8 million and a $ 1.4 million advance interest rate, the SEC said. The bank also agreed to pay a $ 17.4 million civil penalty.

“UBS is pleased to have resolved this issue in good faith related to training provided between February 2016 and February 2017 for an option overlay option,” the bank said in an email.

“UBS appreciates the SEC’s recognition that UBS voluntarily addressed the problem in early 2017 by improving its risk control framework and strengthening its strategy training program.”


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