{"id":5090,"date":"2010-11-05T00:00:00","date_gmt":"2010-11-05T05:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2010\/11\/ubs_must_pay_530000_for_sale_o"},"modified":"2022-04-03T16:27:56","modified_gmt":"2022-04-03T21:27:56","slug":"ubs-must-pay-530000-for-sale-o","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/ubs-must-pay-530000-for-sale-o\/","title":{"rendered":"UBS Must Pay Couple $530,000 for Lehman Brothers-Backed Structured Notes"},"content":{"rendered":"

A Financial Industry Regulatory Authority arbitration panel has ordered UBS<\/a> AG to pay two clients $529,688 over their purchase of Lehman Brothers Holdings notes. The investors, Steven and Ellen Edelson, were told that they were buying \u201cstructured products, some of which were \u201cprincipal protected.\u201d<\/p>\n

Between 2006 and 2008, the Edelsons, who used to own a plumbing supply company, purchased some $3.5 million in structured products\u2014$529,688 of which came from Lehman. They even purchased the Lehman notes as late as August 2008, just a month before the bank failed.<\/p>\n

Some of the Lehman notes that they bought were called \u201cReturn Optimization Securities with Partial Protection,\u201d and \u201c100% Principal Protection Notes\u201d (PPN). According to the couple\u2019s securities fraud lawyer, the Lehman notes are now valued at pennies on the dollar). Their attorney contends that by calling the notes \u201cprincipal protected,\u201d UBS misrepresented the risks involved in investing in the structured notes.<\/p>\n

According to Forbes.com, Lehman\u2019s structured notes were supposed to perform like an S&P 500 index or a basket of securities. However, the PPN should be different from either in that the investments\u2014in return for the financial security\u2014would be capped. Unfortunately, as investors found out in September 2008, there were \u201cprincipal protected\u201d investments that did not live up to their name because they lacked that inferred protection.<\/p>\n

UBS maintains that it followed \u201cregulatory requirements\u201d when it sold Lehman notes and that it could not have foreseen the latter\u2019s financial collapse. Meantime, FINRA has ordered the investment bank to repurchase the notes from the retired couple.<\/p>\n

Securities Fraud Against UBS Over Lehman Products<\/strong>
\nUBS has reportedly sold $1 billion of Lehman products to US investors. In six of the seven cases alleging securities fraud that were decided through FINRA, UBS must now repay some or all of the losses sustained by the investors.<\/p>\n

Related Web Resources:<\/strong><\/p>\n

UBS Having Hard Time With Lehman Structured Products Arbitration<\/a>, Forbes, April 26, 2010<\/p>\n

UBS Loses Lehman Arbitration Note Claim by Small Investor<\/a>, Stockbroker Fraud Blog, December 9, 2010<\/p>\n

Brokers Renew Push for Investors to Buy Structured Products<\/a>, Stockbroker Fraud Blog, June 12, 2009<\/p>\n

Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

A Financial Industry Regulatory Authority arbitration panel has ordered UBS AG to pay two clients $529,688 over their purchase of Lehman Brothers Holdings notes. The investors, Steven and Ellen Edelson, were told that they were buying \u201cstructured products, some of which were \u201cprincipal protected.\u201d Between 2006 and 2008, the Edelsons, who used to own a […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3752,3755],"tags":[],"class_list":["post-5090","post","type-post","status-publish","format-standard","hentry","category-financial-firms","category-ubs"],"yoast_head":"\nUBS Must Pay Couple $530,000 for Lehman Brothers-Backed Structured Notes — Investor Lawyers Blog — November 5, 2010<\/title>\n<meta name=\"description\" content=\"A Financial Industry Regulatory Authority arbitration panel has ordered UBS AG to pay two clients $529,688 over their purchase of Lehman Brothers Holdings — November 5, 2010\" \/>\n<meta name=\"robots\" content=\"index, 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