NAPLES, Fla., March 9, 2010 (GLOBE NEWSWIRE) -- The Vernon Healy investor advocacy law firm filed an $800,000 claim today against UBS and accused the brokerage of committing gross misconduct when it marketed and sold $800,000 worth of Lehman principal protected notes to a Houston businessman as a safe and conservative "principal protected" investment in November 2007.
UBS (NYSE:UBS) designed the Lehman structured product and marketed it to its customers as safe and 100 percent "principal protected" even though in reality, the principal protected notes were essentially an unsecured loan to now-bankrupt Lehman Brothers, according to the Vernon Healy claim filed today.
The claim, filed before FINRA, the Financial Industry Regulatory Authority, seeks compensatory and punitive damages against UBS on behalf of the investor. The Vernon Healy law firm has filed almost $2 million in claims against UBS on behalf of Lehman note investors in the past month alone.
These UBS-designed investment products supplied Lehman Brothers (Pink Sheets:LEHMQ) with an infusion of unsecured loans from main street investors as Lehman Brothers' solvency became a concern, according to the claim. The Lehman Brothers bankruptcy in September 2008 left Lehman note holders standing essentially at the back of the line as unsecured creditors.
After Lehman declared bankruptcy, the Texas investor received his October 2008 monthly statement, which dropped the value of the investment from $818,000 to zero, the claim states. This complete loss of valuation was contrary to the representation by UBS that the structured product was "principal protected," according to the claim.
As the architect of these particular Lehman structured products, UBS knew or should have known of Lehman's precarious financial position, but UBS urged its financial advisors to sell Lehman principal protected notes as safe to their clients, according to the claim.
Written material obtained by Vernon Healy as part of its pre-filing investigation shows that UBS disseminated misleading product descriptions to its financial advisors that portrayed the Lehman notes as investments that put none of the investor's principal at risk, today's claim states.
New Hampshire securities regulators have taken action against UBS for deceptive practices involving Lehman Brothers Asian Currency Basket Principal Protected Notes, the same product sold to the Texas investor filing today's claim.
International investors, particularly from the UK, were pitched Lehman structured notes by affiliates of Credit Suisse, Citi Bank and UBS.
Vernon Healy is a Naples, Florida law firm that represents investors who are victims of stock fraud and stock losses due to broker fraud and brokerage firm fraud and misconduct. Vernon Healy securities attorneys are experienced in securities arbitration and business litigation and assist clients in recovering losses caused by all manner of financial fraud and negligence.
URL: http://www.lehmannotes.com/2010/03/vernon-healy-files-800000-investor-claim-against-ubs-alleging-deceptive-sales-of-lehman-notes.html