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UBS Financial to pay $4.4M to Puerto Rican bond investor

A FINRA arbitration panel ordered UBS Financial Services Inc. to pay a total of $4.4 million to a claimant, who invested in Puerto Rico closed-end funds and bonds, to settle fraud allegations stemming from the use of lines of credit to purchase bonds and funds.

The claimant, Dr. Luis Cummings, alleged in March 2015, that the company committed fault, fraud, deceit, recklessness and negligence related to the investments in the Puerto Rico securities, according to a FINRA dispute resolution. The arbitration panel found UBS Financial Services Inc. and UBS Financial Services Inc. of Puerto Rico jointly and severally liable and ordered the companies to pay compensatory damages, attorneys fees and costs and expenses related to filing and arbitration fees, totaling $4.4 million.

The settlement marked the third instance that UBS Financial Services has been dealt a multi-million loss involving Puerto Rico bonds or bond funds since December 2016, InvestmentNews reported.