The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that Broker Oliver Owens (Owens), currently employed by UBS Financial Services INC. has been subject to at least one disclosable event. These events include one customer complaint. According to records kept by The Financial Industry Regulatory Authority (FINRA), Owens’s most recent customer complaint alleges that Owens recommended unsuitable investments in structured products and makes allegations concerning misconduct relating to the handling of the customer’s accounts.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $2,621,498.00 on July 07, 2021.
Time frame: 15-Jan-2009 to 07-Jul-2021\, Allegations: Claimant alleges that UBS recommended unsuitable investments of Structured Investment Products in Claimant’s account. Claimant alleges that UBS misrepresented and failed to disclose material facts concerning certain investments and the fees/commissions being charged. Claimant also alleges unauthorized trading.
Structured products belong to a category of derivative products, which obtain their performance from data linked to the market. A structured product is commonly tied to a reference index that determines its market risk. A source might include a single security, a basket of securities like a market index, commodities, interest rates, or a portfolio of real estate loans. The variety of products that can be structured demonstrates the difficulty in formulating a single unified definition of a structured product.
Structured products often offer weaker risk/return profiles compared to standard debt or equity investments since the issuing brokerage firms, mainly large banks, seek to earn from the gap between investor payments and the revenue generated from issuing structured notes, minus broker commissions and fees. Given the sophistication of these investments, most investors will be unable to fully understand their benefits or assess the chances of gains and losses. Some brokers mislead clients by portraying these investments as fixed income or bond-like assets that return capital. Structured products pose a greater risk of loss than corporate debt and other fixed-income alternatives, making them an inappropriate choice for fixed-income recommendations.
Recently, firms have begun selling redeemable structured notes often linked to a single investment or a basket of investments. The extreme risk of structured products associated with single securities is evident in multiple examples, showing little to no real benefit. Our firm examined a structured note tied to Peloton’s stock, offering investors 1.0625% interest per month (12.75% annually), and another note linked to Zillow’s stock, which promised a 12% annual interest paid monthly, provided the stock prices remained above a set threshold. Only if both stocks depreciate by nearly 40% would the interest payment be entirely removed. In addition, if the stocks lost more than approximately 40% of their value then the investor would also lose their corresponding principal based upon the performance of the stocks and could lose their entire investment. Further, the notes were callable and could be cancelled by the sponsor.
These products are very high risk and low reward propositions because the investor can only profit at most by 12-12.75% over the course of one year. Even if Peloton or Zillow doubled in value all the investor could achieve would be the interest payment as their profit and none of the price appreciation. Meanwhile the maximum loss is 100% of the investment if the stocks fell severely. Accordingly, the investor takes dramatic downside risks associated with the volatile stocks while having no chance to participate in the success of the stock.
According to newsources, a study revealed that 7.3% of financial advisors had a customer complaint on their record when records from 2005 to 2015 were examined. Brokers must publicly disclose reportable events on their BrokerCheck reports that include customer complaints, IRS tax liens, judgments, investigations, terminations, and criminal cases.
Owens entered the securities industry in 1985. Owens has been registered as a Broker with UBS Financial Services INC. since 2008.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.