UBS Bond Fund Investment Loss Claims

As the Puerto Rico economy continues to falter, many investors are faced with staggering losses in their investments in UBS-affiliated closed-end bond funds. There appears to be a common theme among many of the investors, who bought the leveraged UBS-affiliated funds without understanding of the true nature or risks of the funds. Indeed, last year UBS paid a fine of more than $25 million for misrepresenting and omitting certain facts about the funds to investors. Investors who suffered Puerto Rico bond losses may be able to recover their losses through a FINRA arbitration proceeding.

In addition to the risky nature of the leveraged UBS-affiliated bond funds, many investors used margin borrowing to purchase shares of the funds, sometimes on the advice of their brokers. Borrowing money to buy leveraged securities is a recipe for disaster. For that reason, we understand that UBS Puerto Rico ("UBS") prohibits such transactions, which begs the question how UBS Puerto Rico allowed such trades to happen.

Unfortunately, many Puerto Rico investors did not appreciate the massive risks they were taking, and UBS failed to adequately explain that risk to many investors. As the UBS funds dropped in value, many UBS Puerto Rico clients have been forced to liquidate hundreds of millions of dollars in fund holdings to meet margin calls.

UBS Puerto Rico has a massive presence on the island, employing more than 100 brokers. A significant amount of UBS Puerto Rico's revenues reportedly were generated by the commissions and other fees related to the UBS-affiliated bond funds.

Dimond Kaplan & Rothstein, P.A. has teamed up with Puerto Rico's former two-term governor, Carlos Romero Barceló, to represent UBS Puerto Rico clients who lost money in UBS-affiliated closed-end bond funds.

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