CDOs Sold by UBS and Merrill Lynch
Merrill Lynch and UBS sold billions of dollars in CDOs to investors around the world. Some of the CDOs which sustained heavy losses include Norma CDO I, Centre Square CDO, South Coast Funding V CDO, Mezzanine ABS CDO, the Tabs CDO and North Street 2002-4.
As has been reported, Norma CDO I Ltd., bet heavily on the success of the sub-prime market. Just nine months after it sold about $1.5 billion in securities to its investors, the value of Norma has been decimated and is reported to be worth only a fraction of its original value. The SEC has been investing whether Wall Street brokerage firms, like Merrill Lynch and UBS, deliberately misvalued, or mismarked, massive holdings of mortgage securities.
North Street 2002-4, as with many CDO's was designed by UBS and sold to institutional investors. The HSH Nordbank lawsuit against UBS for breach of "contractual and fiduciary duties" in connection with the management of North Street alleges that "UBS exploited the structure [of North Street] for its own ends, at HSH's expense, in violation of its contractual and fiduciary duties."
The Law Offices of Howard M. Rosenfield has pursued claims on behalf of investors who lost millions in the CDO market. If you are an investor in CDOs that were packaged and/or underwritten by UBS or other issuers,or if you have information relevant to our investigation, please contact our firm.
UBS AND LEHMAN BROTHERS "PRINCIPAL PROTECTED" INVESTMENTS
Many UBS brokers recommended Lehman Brothers Principal Protected Notes as a safe fixed income component with downside risk protection. However, structured notes " a derivative investment,were designed to meet the needs of banks and insurance companies and originally were not intended for retail customers.
Lehman Principal Protected Notes were marketed by several brokerage firms including Lehman Brothers, Citigroup, UBS, Merrill Lynch and Wachovia.
The Notes were sold by touting the supposed "uncapped appreciation potential" pegged to gains in the Standard & Poor's 500 Index, and brokers were told to tell their customers that In the worst case, they would get back their investment in three years.
Lehman's Sept. 15 bankruptcy filing resulted in a collapse of the market for these notes,Holders of thesenotes now are grouped with other unsecured creditors in the bankruptcy.
UBS, Switzerland's largest bank, faces dozens of claims in the US from clients who bought "100 per cent principal protected notes' issued by Lehman Brothers Holdings that suffered significant declines in value. UBS brokers touted the so-called structured notes as low-risk investments and failed to emphasize they were unsecured obligations of Lehman, which filed for bankruptcy in September.