UBS Agrees to Pay $25 Million to Settle SEC Fraud Charges Related to YES

Posted on July 13th, 2022 at 3:33 PM
UBS Agrees to Pay $25 Million to Settle SEC Fraud Charges Related to YES

From the Desk of Jim Eccleston at Eccleston Law:

The Securities and Exchange Commission (SEC) has agreed to a settlement with UBS Financial Services. The firm has agreed to pay $25 million to settle fraud charges pertaining to a complex options trading strategy known as YES, or Yield Enhancement Strategy. 

UBS marketed and sold YES to nearly 600 investors via its domestic financial advisor platform between February 2016 and February 2017, according to the SEC. The SEC alleged that UBS failed to provide its financial advisors with adequate training and supervision related to the YES investments. Although UBS recognized and recorded the substantial risks associated with the YES investments, the firm failed to share this material information with investors or its advisors, according to the SEC. 

The SEC further alleged that UBS’s advisors marketed the strategy without sufficiently understanding the risks associated with the YES investments or a reasonable belief that the advice provided was in the best interest of their clients. Without admitting or denying any of the SEC’s investigatory findings, UBS agreed to pay a civil penalty of $17.4 million, disgorgement of $5.8 million and prejudgment interest of $1.4 million. 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, sec, YES

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