Older Investors Sue UBS Over Puerto Rico Bond Funds

Posted on May 20th, 2014 at 9:05 AM

From the Desk of Jim Eccleston at Eccleston Law Offices:

Older investors, who invested in Puerto Rico bond funds, have sued UBS, claiming that the firm took advantage of them by putting them in mutual funds holding heavy positions in Puerto Rico bond funds that it portrayed as safe, secure and not risky. The investment claim the fund lost much of their life savings and caused billions of losses.

UBS allegedly generated tens of millions of dollars of extra fees by selling those unsuitable Puerto Rico government bonds, which it underwrote, and which it should have known were risky given the economy's instability.

In addition, UBS worsened the problem by using leverage in the funds, and encouraging clients who needed to preserve capital ahead of retirement to take out $500 million of costly loans to boost their investments in the funds.

Puerto Rico's economy has been in or near recession for eight years, and its debt was cut to junk status this year by the three major U.S. credit rating agencies.

The attorneys of Eccleston Law Offices represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 50 years in delivering the highest quality legal services.

Related Attorneys: James J. Eccleston

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