Tr?id=566623520170033&ev=PageView&noscript=1

UBS Faces Class Action Lawsuit Over Cash Sweep Programs

Posted on September 27th, 2024 at 11:52 AM
UBS Faces Class Action Lawsuit Over Cash Sweep Programs

From the desk of Jim Eccleston at Eccleston Law

UBS has been hit with a class action lawsuit over its cash sweep programs, joining other major firms like LPL, Wells Fargo, and Ameriprise, which have faced similar litigation. FinancialPlanning reports that the suit claims UBS mishandled client funds in retail brokerage accounts managed on an advisory basis between 2013 and 2023.

Cash sweep programs, a common feature at many financial firms, involve transferring excess cash from clients’ accounts into interest-bearing accounts at various banks. The lawsuit alleges that UBS prioritized its financial gain by steering client funds into its cash sweep programs, where interest rates were neither competitive nor in compliance with the firm’s legal duties.

The complaint highlights that UBS offered several cash sweep options tailored to different types of accounts, such as trusts, retirement advisory accounts, and non-retirement retail accounts. However, those options provided annual percentage yields significantly lower than those offered by competitors like Vanguard and Fidelity. Unlike some firms that automatically sweep uninvested cash into high-yield money market funds, UBS allegedly limited these options for retail clients.

 

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

Tags: eccleston, eccleston law

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

This was the best of all possible outcomes and I cannot thank you and the team enough.

Michael S.

LATEST NEWS AND ARTICLES

1785949175 Law
August 5, 2026
FINRA Arbitration Panel Orders Arkadios Capital to Pay $2.7 Million in Ponzi Scheme-Related Claim

A Financial Industry Regulatory Authority (FINRA) arbitration panel has ordered Arkadios Capital to pay $2.7 million in damages to an investor who alleged the firm failed to supervise a former registered representative whose father operated a long-running Ponzi scheme, according to InvestmentNews.

1785858278 Law
August 4, 2026
SEC Fines Former LPL Broker $125,000 for Undisclosed Conflicts in Private Securities Offerings

The Securities and Exchange Commission (SEC) has censured a former LPL Financial broker and imposed a $125,000 civil penalty after finding that he failed to disclose conflicts of interest related to private real estate securities offerings that generated nearly $1.5 million in compensation, as reported by AdvisorHub.

1785772777 Law
August 3, 2026
FINRA Launches Review of High-Risk Structured Notes Sales and Supervision

The Financial Industry Regulatory Authority (FINRA) has launched a regulatory sweep examining the sale of high-risk structured products, with particular attention on non-principal protected "worst-of" structured notes, according to AdvisorHub.