UBS Fined $371K For YES Strategy

The Financial Industry Regulatory Authority (FINRA) ruled that UBS Financial Services must pay an Ohio couple $371K for the financial losses they incurred due to UBS’s Yield Enhancement Strategy (YES). The couple accused the broker of negligence, misrepresentation, breach of fiduciary duty and breach of contract, negligent supervision, and violation of the Ohio Securities Act.

This is the third arbitration action by UBS that the brokerage firm has lost, including one awarded more than $1 million to two Denver investors earlier this year. The first prize against UBS was awarded to an investor in December for $90K.

The $371K award includes $342K in damages and $28,600 in related costs. The law investment fraud firm represented investors who lost money because of their involvement in UBS’s complex option overlay strategy, which was recommended and misrepresented to many of its clients.

UBS Yes investors have been contacting investment fraud lawyers in droves because they lost a lot of money as the CBOE’s 2018 volatility index hit its highest level in a long time. UBS brokers and financial advisers reassured investors that they could expect to recover some of their losses, but that did not happen. Instead, investors lost even more money when COVID-19 struck.

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Unfortunately, most YES strategy investors had no idea how much risk and volatility they were taking.

Haselkorn & Thibaut, a national investor law firm, is currently working with investors to recover losses.  Investors looking to explore their options can call 1 888-628-5590.

In the investor complaint, UBS Financial Services sought to erase the records of Richard Mark Held, Frederick Maximillian Kort, and Ortal Shachar. The arbitration panel rejected the request. The three men were unresponsive in the case. She and other clients disputed the notes in their broker check documents, which also contained other claims related to UBS’s strategy.

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UBS broker Richard Held runs the Held Group in Chicago. He has been working in the industry for 48 years. He is named in another pending case in which investors accuse him of impropriety and misrepresentation and are seeking damages of $890K.

Frederick Kort, a former UBS broker with ten years of experience in the industry, is registered as an investment adviser with IHT Wealth Management in Chicago. The broker-dealer fired Kort in 2018 in an affair that appears to have nothing to do with him. Kort has at least two other pending policy claims on his list. That includes a request for $342,500 in damages in a case in March in which the plaintiff sought $575K in damages.

The most recent FINRA arbitration case, UBS’s $890K strategy suit, was filed last year and appeared to involve Kort and Held. UBS broker Ortal Shachar was one of two clients in the dispute over his broker check. Kort, Held, and other investors maintained that their broker check records had nothing to do with UBS’s strategy.

 

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