First, on September 15, 2021, a FINRA Dispute Resolution Services arbitration panel in Houston, Texas, ordered UBS Financial Services, Inc. (“UBS”) to pay customers over $357,000 in compensatory damages. Then, on September 17, 2021, arbitrators in Boca Raton, Florida, awarded customers over $691,000 in compensatory damages, more than $115,000 in prejudgment interest, and nearly $41,000 in expert witness fees.
The cause of action in both arbitration cases arose out of investments in UBS’s Yield Enhancement Strategy (“YES”), a complex and highly risky options strategy.
Customers across the country have filed securities arbitration claims against UBS, alleging that the brokerage firm misrepresented the options strategy as a safe way to obtain marginally higher yield on a portfolio of securities. In actuality, the complexity and nature of YES exposed customers to a significant risk of loss. Customers have also alleged that UBS and its team of options traders conducted the YES program with virtually no supervision or compliance oversight and with inadequate risk controls.