MIAMI, June 26, 2014 (GLOBE NEWSWIRE) -- UBS announced today that Miguel A. Ferrer, Chairman of UBS Financial Services of Puerto Rico, is leaving UBS at the end of July, says Sonn & Erez LC, a law firm representing hundreds of customers of UBS over the sale of UBS proprietary Puerto Rico bond funds. "I think it's a major shakeup and signals, in my opinion, that UBS is distancing itself from those at the center of the UBS bond fund controversy that has cost UBS customers hundreds of millions if not billions in losses," said Jeffrey Sonn, Esq., of Sonn & Erez.
UBS and other investors suffered large losses through investments in closed-end funds whose sales by UBS are now the subject of a criminal investigation by the FBI. Packed with Puerto Rican government bonds that UBS had underwritten, the funds plunged in value at the end of last summer as concerns grew about the persistent weakness in Puerto Rico's economy and its ability to repay its debt. "We believe the recent FBI investigation is about whether UBS executives in Puerto Rico and in the U.S. knew that proceeds from loans made to UBS customers in Puerto Rico were used to purchase more UBS proprietary bond funds, in violation of federal regulations and UBS' own lending rules," said Eliezer Aldarondo, Esq. of Aldarondo & Lopez-Bras in Guaynabo, Puerto Rico, cocounsel with Sonn & Erez. "If so, the UBS officials may be subject to civil and criminal liability," added Sonn.
"The timing of Ferrer's departure during the early stages of an FBI investigation and hundreds of FINRA arbitrations against UBS is certainly open to interpretation about the motives of UBS," said Sonn. "From my experience, I would not be surprised if UBS gave Miguel Ferrer a golden parachute along with a strong confidentiality agreement so UBS can insure that Ferrer will remain loyal to UBS during these civil and criminal cases," added Sonn. "'We look forward to reading his termination agreement that we expect to get in discovery during the pending FINRA arbitrations," said Erez.
Sonn and Erez, along with the Puerto Rico-based law firm of Aldarondo & Lopez Bras, represent over 170 customers of UBS that have significant losses in UBS proprietary bond funds, including:
Tax-Free Puerto Rico Fund, Tax-Free Puerto Rico Fund II, Tax-Free Puerto Rico Target Maturity Fund, Puerto Rico AAA Portfolio Target Maturity Fund, Inc., Puerto Rico AAA Portfolio Bond Fund, Puerto Rico AAA Portfolio Bond Fund II, Puerto Rico GNMA & U.S. Government Target Maturity Fund, Puerto Rico Mortgage-Backed & U.S. Government Securities Fund, Puerto Rico Fixed Income Fund, Puerto Rico Fixed Income Fund II, Puerto Rico Fixed Income Fund III, Puerto Rico Fixed Income Fund IV, Puerto Rico Fixed Income Fund V, Puerto Rico Fixed Income Fund VI, Puerto Rico Short Term Investment Fund, Multi-Select Securities Puerto Rico Fund, UBS IRA Select Growth & Income Puerto Rico Fund, Puerto Rico Investors Family of Funds, Puerto Rico Investors Tax-Free Fund, Puerto Rico Investors Tax-Free Fund II, Puerto Rico Investors Tax-Free Fund III, Puerto Rico Investors Tax-Free Fund IV, Puerto Rico Investors Tax-Free Fund V, Puerto Rico Investors Tax-Free Fund VI, Puerto Rico Tax-Free Target Maturity Fund, Puerto Rico Tax-Free Target Maturity Fund II, Inc., Puerto Rico Investors Bond Fund I.
Sonn & Erez PLC is a nationally leading law firm that represents investors who are the victims of investment fraud or negligence. Sonn & Erez PLC represents individual and institutional investors in a wide variety of investment and securities cases. Aldarondo & Lopez-Bras is a leading law firm in Guaynabo, Puerto Rico, also representing investors harmed by the conduct of UBS.