BOCA RATON, Fla., Jan. 12, 2017 /PRNewswire/ -- A Securities Arbitration Panel has ordered UBS Financial Services Inc. to pay $18.2 million, including $4 million in punitive damages, to a San Juan, Puerto Rico family in connection with losses sustained in Puerto Rican Closed-End Bond Funds ("CEFs") that have been the subject of hundreds of claims against the Wall Street Company.
The large damage award in favor of Victor Gomez, Jr., his wife, Socorro Gomez, and their daughter, Madeline, was issued late Wednesday by three Arbitrators empaneled by the FINRA Office of Dispute Resolution after nine days of hearings and testimony in San Juan, Puerto Rico in November and December 2016.
The Arbitrators awarded the Gomez family $9.63 million in compensatory damages, $4 million in punitive damages, nearly $4.5 million in attorneys, and $86,550 in costs, for a total of $18.2 million.
It is believed to be the first arbitration in which punitive damages have been imposed on UBS Financial Services, Inc. in connection with the Company's sale of Puerto Rico municipal bonds and closed-end bond funds that collapsed in the Fall of 2013, resulting in more than $1.5 billion in customer claims.
"We are so grateful that these three Arbitrators had the courage and integrity to punish UBS for its wrongful conduct that literally destroyed the life savings of the Gomez family and hundreds of other Puerto Rico citizens," said Gomez Florida attorney Lloyd Schwed. "In this case, the system worked: a Wall Street giant was made to pay for its reckless disregard for the rights of its customers."
According to an analysis by the Securities Arbitration Commentator, the $18.2 million award is the 17th largest securities arbitration award to public customers in the past decade.
The Claimants were represented by Attorneys Lloyd Schwed, Esq. of Schwed Kahle & Kress, P.A. in Palm Beach Gardens, Florida; Harold D. Vicente-Colon, Esq. and Harold Vicente Sr., Esq. of Vicente & Cuebas in San Juan, Puerto Rico; and Francisco Pujol, Esq. of Pujol Law Office, PSC, of San Juan, Puerto Rico.
The Gomez family alleged that UBS Vice President Jose "Whopper" Ramirez violated federal and state securities laws and committed fraud in connection with the sale of more than $50 million in Puerto Rico closed-end funds and municipal bonds that caused the family to lose more than $25 million in family wealth in a period of 30 days in the Fall of 2013. The UBS Vice President, Ramirez, was terminated by the company and he has been permanently barred from the securities industry by both the SEC and FINRA.
The Claimants alleged that UBS failed to properly supervise Ramirez and were reckless in permitting him to over-concentrate the Gomez family's life savings in the unsuitably risky Puerto Rico closed-end bond funds underwritten, managed and marketed by UBS.
UBS has announced in its quarterly reports that the company has been the subject of hundreds of customer claims alleging more than $1.5 billion in damages arising out of the company's sale of Puerto Rico municipal bonds and closed-end bond funds.
UBS has been sanctioned by the SEC, FINRA and Puerto Rico regulators in connection with its sales practices associated with the Puerto Rico municipal bonds and closed-end bond funds.
Should you have any questions regarding this arbitration decision, please feel free to contact Gomez attorney Lloyd Schwed, Esq. at 561-694-0070.
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SOURCE Schwed Kahle & Kress, P.A.