Broker-Dealer Losses Yet Another Investor Claim Involving Its Yield Enhancement Strategy
A Financial Industry Regulatory Authority arbitration panel has awarded investors $1.34M, including punitive damages, for losses sustained in the UBS Yield Enhancement Strategy. This is the latest award related to UBS Financial’s complex options trading strategy that has cost investors over $1B.
In June 2022, UBS agreed to pay $25M to settle Securities and Exchange Commission (SEC) fraud charges accusing the firm with failure to provide its brokers with proper training and oversight in the YES program even as they sold this strategy to hundreds of investors. This purportedly caused many of the firm’s financial advisors to not fully comprehend the risks involved and affected their ability to determine whether the Yield Enhancement Strategy was, in fact, in the best interests of these customers.