INVESTOR ALERT: Virginia Regulator Alleges UBS Made Unsuitable Recommendations

UBS Financial Services, Inc. (CRD#: 8174, Weehawken, New Jersey) is a brokerage and investment advisory firm regulated collectively by Financial Industry Regulatory Authority (“FINRA”), Securities and Exchange Commission (“SEC”) and state securities regulators. Apparently, regulators have sanctioned UBS a number of times for securities industry misconduct. Notably, one regulator in particular, the Virginia State Corporation Commission, who the firm has been registered with since September 1981, issued a Settlement Order #SEC-2018-00029 on January 29, 2019 to resolve the Division of Securities and Retail Franchising's allegations that UBS Financial Services violated Commission Rules by a UBS Financial Services, Inc. registered representative making unsuitable recommendations to customers about precious metals and gold investments. Evidently, UBS Financial Services made a deal with the Virginia regulator which involves the firm paying as many as eighteen aggrieved customers a total of $288,970.20. However, the firm did not admit to liability.

UBS Financial Services Agent Allegedly Made Unsuitable Gold And Precious Metals Recommendations

Apparently, the Division of Securities and Retail Franchising investigated UBS specifically concerning a former agent's unsuitable recommendations. It appears that the agent worked at the firm's Roanoke, Virginia offices. Apparently, the UBS Financial Services agent unreasonably advised investors to buy gold and precious metals. Supposedly, the agent made those recommendations from 2013 to 2014. Because of the agent’s advice, investors allegedly held excess concentrations of gold and precious metals investments in their accounts. The Division indicated that it was not suitable for the customers to maintain over-concentrations of those investments. Because of this, the Division claimed that the firm violated Commission Rule 21 VAC 5-20-280 A 3.
Notably, the Division indicated that the firm’s agent did not have a reasonable basis to believe that the recommendations were suitable for eighteen customers.  This supposedly violated the aforementioned Commission Rule when considering the risks of the gold and precious metals investments, the lack of the firm’s due diligence, or the customers’ investment profiles. Apparently, the gold and precious metals were not appropriate when considering the customers’ risk tolerances, financial situations and investment objectives.

UBS Financial Services Inc. Settles Virginia Regulator’s Allegations Of Unsuitability

Evidently, the Commission could have revoked UBS Financial Services’ registration or sanctioned the firm somehow if it found that the firm violated certain Virginia Securities Act provisions. Apparently, rather than litigate the issue, UBS Financial Services settled the Division’s allegations of unsuitability. Specifically, UBS  pledged to pay at least $288,970.20 to as many as eighteen UBS Financial Services customers. Also, the firm reportedly agreed to pay the Division’s $30,000.00 in costs for its investigation into its activities.

Investors who have incurred losses from UBS Financial Services brokers are encouraged to contact Soreide Law Group at (888) 760-6552 for a free consultation. Our firm has recovered millions of dollars for investors who have suffered losses. We represent clients on a contingency fee basis and advance all costs.