UBS Settles With SEC|for $26.6 Million

     WASHINGTON (CN) – UBS Financial Services of Puerto Rico will pay $26.6 million to settle federal claims of misleading investors during the liquidity crisis, the SEC said Tuesday.



     The SEC also filed contested administrative proceedings against UBS Puerto Rico’s former CEO Miguel A. Ferrer and its head of capital markers Carlos J. Ortiz.
     According to the SEC order, “starting in 2008, UBS Puerto Rico solicited thousands of retail investors by promoting … closed-end funds’ market performance and continuously high premiums to net asset value (up to 45 percent) as the result of supply and demand in a competitive and liquid secondary market. When investor demand began to decline, UBS Puerto Rico sought to maintain the illusion of a liquid market by buying shares into its own inventory from customers who wished to exit the market. Despite a falling market, UBS Puerto Rico continued to sell shares by conducting primary offerings in order to grow its closed-end fund business. Throughout this period, UBS Puerto Rico failed to disclose the true state of the market to investors.”

%d bloggers like this: