UBS Financial Services, Inc. Principal Protected Notes (PPN) Restitution Information

This case is closed. You may review eligibility and related claims information for reference only.

On April 11, 2011, FINRA fined UBS Financial Services Inc. $2.5 million and required UBS to pay $8.25 million in restitution for omissions and statements made that effectively misled some investors regarding the "principal protection" feature of the 100% Principal-Protection Notes (PPNs) Lehman Brothers Holdings Inc. issued prior to its September 2008 bankruptcy filing. PPNs are fixed-income security structured products with a bond and an option component that promise a minimum return equal to the investor's initial investment.

Who is eligible for restitution? 

Approximately 760 UBS customers who purchased Lehman PPNs from UBS during the period from March 17, 2008, to June 30, 2008, and held those Lehman PPNs as of April 11, 2011.  

Furthermore, eligible customers must have had the following net worth and risk profiles at the time of their investment: 

  1. A primary risk profile of “Conservative.” These investors will receive 100 percent of invested principal minus the market value of the notes that they still possessed as of April 11, 2011; and
  2. Investors with a primary risk profile of “Moderate” and $1 million or less in net worth. These investors will receive 50 percent of invested principal.

Restitution will not be paid to customers who entered into a settlement agreement with UBS, or otherwise previously agreed to resolution of their claims with UBS on or before April 11, 2011. Classes of customers who are entitled to restitution and who entered into a settlement agreement with UBS from the date of March 1, 2011, until April 11, 2011, will receive no less than the restitution they would be entitled to pursuant to the settlement terms.


How will eligible individuals be notified?

UBS is required to notify customers and complete the remediation process for both categories of customers.

What options are available to investors?

The remediation plan does not foreclose your ability to pursue arbitration or mediation if you believe you have suffered losses. You should consult an attorney as to your rights.

Additional questions or concerns

Further questions may be directed to FINRA’s Office of Investor Education by calling (202) 728-6964.