Articles Posted in Yield Enhancement Strategy

On March 31, 2021, a FINRA Dispute Resolution Services arbitration panel in Columbus, Ohio, ordered UBS Financial Services, Inc. (“UBS”) to pay customers over $372,000 in compensatory damages and fees.  The claimants, Matthew and Lisa Fisher alleged that UBS and brokers Ortal Shachar and Richard Mark Held presented the Yield Enhancement Strategy (“YES”), an options strategy, as low risk. In actuality, the complexity and nature of YES exposed the Claimants to a significant risk of loss.

This order is the second arbitration award against UBS in March 2021 concerning YES and the third since December 2020.   On March 5, 2021, another FINRA arbitration panel in Denver, Colorado, ordered UBS to pay customers over $1 million in compensatory damages.     In December 2020, a FINRA arbitration panel in Boca Raton, Florida, awarded a customer nearly $90,000.

UBS has faced numerous lawsuits from customers in the form of FINRA securities arbitrations related to YES, a complex managed options strategy that UBS marketed as safe and market-neutral. The customers have claimed that the strategy was not suitable for them and that UBS materially misrepresented and omitted the risks of the strategy.

On March 5, 2021, a FINRA Dispute Resolution Services arbitration panel in Denver, Colorado, ordered UBS Financial Services, Inc. (“UBS”) to pay customers over $1 million in compensatory damages.  The claims, which include breach of duty, violations of the Nebraska Securities Act, and professional negligence arising out of broker Jason Dworak’s recommendations concerning the UBS Yield Enhancement Strategy (“YES”).   The arbitration panel also awarded prejudgment interest to the customers.

The $1 million judgment is the second arbitration award against UBS within a matter of months.  In December 2020, a FINRA arbitration panel in Boca Raton, Florida, awarded a customer nearly $90,000.  The Florida arbitration panel concluded that the UBS YES was not suitable for the investor, Gerald S. Backman, a retired partner at corporate law firm Weil Gotshal & Manges.

UBS has faced numerous lawsuits from customers in the form of FINRA securities arbitrations related to YES, a complex managed options strategy that UBS marketed as safe and market-neutral. The customers have claimed that the strategy was not suitable for them and that UBS materially misrepresented and omitted the risks of the strategy.

On December 22, 2020, a FINRA Dispute Resolution Services arbitration panel in Boca Raton, Florida, ordered UBS Financial Services, Inc. to pay a customer $89,675 in compensatory damages.  After considering the pleadings, the testimony and evidence presented at the hearing, the arbitration panel concluded that the UBS Yield Enhancement Strategy (“YES”) was not suitable for the investor, Gerald S. Backman, a retired partner at corporate law firm Weil Gotshal & Manges.

Many UBS customers, including wealthy and sophisticated investors, who invested in UBS’s Yield Enhancement Strategy have filed lawsuits against UBS in the form of FINRA arbitrations to recover financial losses.   The customers have claimed that the strategy was not suitable for them and that UBS materially misrepresented and omitted the product’s risks.

Investors who have suffered investment losses due to UBS’s Yield Enhancement Strategy should contact experienced securities arbitration attorneys at Iorio Altamirano LLP for a free and confidential case evaluation.  Partner August Iorio, who has been investigating YES for nearly two years, can be reached at august@ia-law.com or toll-free at (855) 430-4010.

Today, UBS Group AG announced that its net profit almost doubled in the third quarter to nearly $2.1 billion from $1.05 billion from a year earlier.

Meanwhile, as UBS and other large investment banking firms continue to rake in huge profits, UBS’s Yield Enhancement Strategy investors continue to suffer avoidable losses.

UBS’s Yield Enhancement Strategy, or YES, is a complex managed options strategy that UBS marketed as a safe, market-neutral overlay that would provide incremental returns to an investor’s portfolio.

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