Boca Raton, Florida (BUSINESSWIRE) – January 20, 2016 – The Securities Arbitration Law Firms of Klayman & Toskes, P.A., www.nasd-law.com, continues to investigate Financial Industry Regulatory Authority (FINRA) sales practice violations related to UBS Exchange Traded Access Securities (ETRACS) whose performance is linked to declining energy, currency and commodity markets. UBS Financial Services, Inc. (UBS), a wholly owned subsidiary of UBS Group A.G. (NYSE:UBS) sells and distributes UBS ETRACS Exchange-Traded Notes (ETNs). UBS ETRACS ETNs, commonly known as structured securities products, are designed to generate greater returns through the use of embedded derivatives designed to track the performance of a volatile security, index, commodity or currency, many times without any principal protections.
FINRA sales practice rules require a fair and balanced representation to investors that UBS ETRACS ETNs are more complex and risky than a simple “interest rate” credit when based on a volatile index or commodity. UBS underwrites, manages and markets billions of dollars in UBS ETRACS ETNs to its customers, including the following:
- UBS ETRACS Alerian MLP Index ETN (NYSE Arca: AMU)
- UBS ETRACS 2X Monthly Leveraged S&P MLP Index ETN (NYSE Arca: MLPV)
- UBS ETRACS Alerian MLP Infrastructure Index ETN (NYSE Arca: MLPI)
- UBS ETRACS 2X Monthly Leveraged Long Alerian MLP Infrastructure Index ETN (NYSE Arca: MLPL)
- UBS ETRACS CMCI Energy Total Return ETN (NYSE Arca: UBN)
- UBS ETRACS CMCI Total Return ETN (NYSE Arca: UCI)
- UBS ETRACS Bloomberg Commodity Index Total Return (NYSE Arca: DJCI)
In 2015, a Securities Exchange Commission (SEC) audit of major Wall Street brokerage firms led to a National Exam Program – Risk Alert Report after the review of sales practices violations related to Structured Securities Products, similar to UBS’ proprietary ETRACS ETNs. According to the SEC examination, deficiencies were found in some brokerage firms’ supervisory and sales practices related to the determination of “suitability” and “levels of concentration” in customer accounts.
Our investigation relates to UBS’ sales practices related to its proprietary ETRACS ETNs. UBS’ violations of FINRA sales practice violations may include misrepresentations and omissions of material facts, conflicts of interest, unsuitable investment advice, securities concentration or the failure to supervise its financial advisors. Our investigation relates to investments in UBS ETRACS ETNs designed to track the Price of Oil, MLP Pipelines, Indexes, Currency and Commodities Baskets, and in some instances leveraged up to 200%.
About Klayman & Toskes, P.A.
Klayman & Toskes, P.A., an experienced, qualified and nationally recognized securities litigation law firm, is continues to investigate FINRA sales practice violations related to the sale of UBS ETRACS ETNs. Investors who have knowledge or experience related to the sales practices of brokerage firms and its financial advisors’ recommendations related to UBS ETRACS ETNs, contact Steven D. Toskes, Esq. at 888-997-9956.