UBS AG (USA) Under Investor Investigation Over Possible Violations of Securities Laws

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Company Name(s): 
UBS AG
Affected Securities: 
NYSE: UBS

San Diego, Sept. 16, 2011 (Shareholders Foundation) -- An investigation on behalf of investors in shares of UBS AG (USA) (NYSE: UBS) over possible Violations of Federal Securities Laws was announced.

The investigation by a law firm focuses on possible claims on behalf of purchasers of the securities of UBS AG (USA) (Public, NYSE:UBS) concerning whether the company and certain of its officers and directors have violated federal securities laws. Specifically the investigation concerns certain statements regarding UBS’ business, its prospects and its operations were materially false and misleading at the time they were made.

UBS AG (USA) reported on Dec. 12, 2010 a Net Income of $7.53billion after it had to report in 2009 $2.73billion Net Loss, respectively on Dec. 31, 2008 $21.29billion Net Loss.

Even though shares of UBS AG (USA) (Public, NYSE:UBS) traded in 2007 at almost as high as $62 per share and fell in 2009 to as low as $7.72 per share on March 6, NYSE:UBS shares were able to gain value in the first half of 2011 from $16.71 on Jan 3rd to $20 per share on April 29, 2011.

However since the end of April NYSE UBS shares fell to slightly above $14.50 per share in the beginning of September 2011.

Then on September 15, 2011, UBS AG said that it has discovered a loss due to unauthorized trading by a trader in its Investment Bank. UBS said the matter is still being investigated, but UBS's current estimate of the loss on the trades is in the range of USD 2 billion. It is possible that this could lead UBS to report a loss for the third quarter of 2011.

The same day it was reported by several media outlets that City of London police detained a 31year old trader, who reportedly worked for the bank’s equities allotment in London. On September 16, 2011 it was reported that the 31-year-old Kweku Adoboli, an employee of the London UBS Exchange Traded Funds (ETF) business, who is the son of a retired United Nations employee from Ghana, was arrested on Sept.16, 2011 on suspicion of fraud. One media outlet said that Adoboli’s fiscal misconduct took place between October 2008 and December 2009, and January 2010 and September 2011.