- The big bank has agreed to a settlement in the USA in the case of allegations of fraud in connection with the “Yield Enhancement Strategy” investment strategy (YES).
- As the Securities and Exchange Commission (SEC) announced on , UBS had to pay $25 million to settle the case.
- One allegation was that UBS had not sufficiently informed clients about the risks of the financial product.
According to the SEC, from February 2016 to February 2017, the bank marketed and sold the YES products to approximately 600 investors through its platform of domestic financial advisors. UBS then failed to adequately train and oversee its financial advisors on the strategy.
The bank knew that the YES investments were associated with considerable risks. This information was also documented. That’s what the SEC found. However, the bank did not pass these documents on to advisors or customers.
As a result, some of the UBS advisors did not understand the risks. As a result, the advice they gave was not in the best interests of their customers.