UBS Financial Services Inc.

Albany, NY: (Jul-16-07) Attorney General Andrew Cuomo's Office filed suit against UBS Financial Services Inc., alleging that the company inappropriately guided customers into a fee-based brokerage program. An investigation revealed that UBS pushed thousands of traditional brokerage customers into the fee-based accounts of its InsightOne brokerage program. The subsequent lawsuit, filed in December, charged UBS with violating state anti-fraud laws, breaches of fiduciary duty, and common law fraud. It also claimed that UBS was aware that InsightOne would be unsuitable and more costly for traditional brokerage customers making few trades per year. The company also was accused of neglecting to properly prescreen customers before recommending InsightOne accounts. In a settlement reached, UBS agreed to a $23.3 million settlement with New York State, resolving all claims. [FORBES: FEE-BASED ACCOUNTS]

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Published on Jul-18-07