UBS Settles With SEC Over Sales of Exchange-Traded Product
From the Desk of Jim Eccleston at Eccleston Law:
The Securities and Exchange Commission (SEC) filed a settled action against UBS Financial Services Inc. over compliance breakdowns relating to sales of a volatility-linked exchange-traded product (ETP). According to the SEC’s order, the relevant ETP was created to monitor short-term volatility projections as measured against derivatives of a volatility index.
The order also contends that UBS adopted a concentration limit on volatility-linked ETPs, but failed to design a system for overseeing and enforcing that limit for five years. According to the SEC, certain advisors possessed a flawed understanding of the risks associated with holding the volatility-linked ETP for an extended period, which resulted in substantial losses for clients between January 2016 and January 2018.
Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.
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