UBS’ wealth management unit was ordered by a FINRA arbitration panel to pay over $2.9m to two investors for losses tied to the sale of Puerto Rico municipal bonds.
The investors, Ana Teresa Lopez-Gonzalez, Andres Ricardo Gomez, have filed an arbitration claim with the FINRA claiming fraud, breach of fiduciary duty, negligence, breach of contract and unsuitability.
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The claim was related to investments in UBS-managed closed-end funds and Puerto Rican municipal bonds, which fell in value as the island commonwealth’s financial crisis deepened.
The arbitration panel granted the investors a combined $2.4m in damages, plus interest, along with more than $534,000 in legal and other costs.
The panel also rejected UBS’ counterclaims brought against Gomez. The Swiss bank said it faces more than $1.1bn in damages tied to its Puerto Rico activities.
A spokesman for UBS said: "Although the arbitrators awarded less than the full damages claimants requested, UBS is disappointed with the decision to award any damages, with which we respectfully disagree."
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