Published on:

UBS Settles Investigation Regarding Unregistered Sales Assistants With The New Jersey Bureau Of Securities

UBS AG (“UBS”) has agreed to pay $98,184.84 in civil penalties to the New Jersey Bureau of Securities regarding an investigation into whether UBS sales assistants were registered in the states where they accepted orders on behalf of investors. According to a News Release issued on Monday, August 26, 2013 by the New Jersey securities regulator, UBS’s “client service associates” took investor orders without having the requisite state registrations and UBS failed to supervise the client services assistants who accepted the client orders. Further, Abbe R. Tiger, New Jersey’s Bureau of Securities Chief, made the following statement in the New Jersey Bureau Of Securities News Release, “over a six-year period, UBS failed to recognize a flaw in its order-entry systems that allowed unregistered persons to accept customer orders.” The investigation involved an undisclosed number of the 2,277 sales assistants UBS employed from 2004 through 2010, who were not licensed in New Jersey, and were also not properly registered in many other states. The New Jersey Bureau Of Securities News Release further states, “UBS settled the multi-state investigation, coordinated by the North American Securities Administrators Association (“NASAA”) and led by the New Jersey Bureau of Securities, by agreeing to pay up to a total of $4.58 million in civil penalties among the 50 states, District of Columbia, Puerto Rico and the U.S. Virgin Islands.” As a result of the investigation, in November 2010, UBS implemented a new order-entry system to ensure employees’ state registrations.

Lax & Neville LLP has nationally represented small broker-dealers, financial services professionals and securities industry companies in regulatory matters and securities-related and commercial litigation. Please contact our team of attorneys for a consultation at (212) 696-1999.