May 1, 2012 | last updated June 1, 2012 2:14 pm

UBS, Wells Fargo, et al fined $9.1M for lapses

Financial regulators sanctioned four securities brokers, including Citigroup, UBS and Wells Fargo which have operations in Connecticut, a combined $9.1 million for plying investors with unsuitable investments, authorities say.

The Financial Industry Regulatory Authority (FINRA) -- which oversees securities broker-dealers -- announced Tuesday sanctioning of Citigroup Global Markets Inc; Morgan Stanley & Co. LLC; UBS Financial Services; and Wells Fargo Advisors LLC for selling leveraged and inverse exchange-traded funds (ETFs) without reasonable supervision and for not having a reasonable basis for recommending the securities.

The firms were fined more than $7.3 million and are required to pay a total of $1.8 million in restitution to certain customers who made unsuitable leveraged and inverse ETF purchases:

  • Wells Fargo -- $2.1 million fine and $641,489 in restitution
  • Citigroup -- $2 million fine and $146,431 in restitution
  • Morgan Stanley -- $1.75 million fine and $604,584 in restitution
  • UBS -- $1.5 million fine and $431,488 in restitution

Neither admitted nor denied the charges, but consented to the entry of FINRA's findings.

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