Securities Arbitration Lawyers BlogUBS Bank Loans Created Unacceptable Risks for Puerto Rico Investors
UBS Financial Services of Puerto Rico has received the attention of many market watchers in the media since their UBS Puerto Rico Family of Funds suffered a “meltdown” in value. What did not receive adequate media attention are UBS’ sales practices which through the zeal of its financial advisors has left Puerto Rico residents holding excessive amounts of a failed financial product, and in many instances laden with UBS Bank loans. We have learned firsthand the extent of the destruction experienced by Puerto Rican residents who have been targeted by UBS.
The UBS Puerto Rico Family of Funds, UBS Puerto Rico Fixed Income Funds and UBS Puerto Rico Investors Tax Free Funds, were designed to be sold exclusively to residents of Puerto Rico according to their Offering documents. The investment objective was tax free income consistent with preservation of capital. A closer look at the fine print deep in the Offering document tells investors a more cautious tale.
The Prospectus and Offering documents for the proprietary closed-end funds artfully disclose some of the potential risks deemed required by regulatory laws. The risks include: