Lehman Structured Notes – New Hampshire Sues UBS

UBS was sued by the New Hampshire Bureau of Securities Regulation last week for selling unsuitable Lehman Brothers structured notes to retail investors as a conservative investment.
These structured notes were debt obligations that also contains an embedded derivative component with characteristics that adjust the security’s risk/return profile.

According to Bloomberg, Jeff Spill, deputy director of securities regulation for enforcement, said “The safety of these products was exaggerated” and “UBS presented these notes as simple, safe investments when in fact they are highly volatile and are subject to shifting market conditions.”

UBS pitched these notes to investors as safe investments. But they were extremely risky and became worthless when Lehman filed for bankruptcy. Our firm represents former UBS clients who bought Lehman notes from UBS. The New Hampshire complaint may help shed some light on these cases and help investors worldwide. Hopefully, other state securities regulators will weigh in as well.