UBS: “Oops. We Mismarked That Mortgage Bond. It’s Actually…Well, It’s Worthless.”

On February 2, 2008, Kara Scannell, Anita Raghavan and Amirefrati reported in The Wall Street Journal reported on Groundhog Day that UBS AG is under federal criminal investigation for misleading investors about the value of its mortgage bonds. When it’s all over, UBS may want to crawl into a hole. At issue:

• Whether UBS AG criminally misled investors by posting inflated prices of its mortgage bonds, despite knowing that their valuations had dropped significantly.

• Whether UBS violated SEC rules by similarly “mismarking” massive holdings of mortgage securities.

If charges are filed, and they stick, UBS will next face civil action.

At present the bank’s total losses for 2007 are estimated $18.4 billion. UBS is seeking an $11.5 billion bailout from Asian and Middle Eastern investors.

Our affiliation of lawyers is actively involved in advising individual and institutional investors in evaluating their legal options when confronted with subprime and other mortgage related investment losses.Â

This entry was posted on Friday, February 8th, 2008 at 6:11 amand is filed under International Investor Losses, UBS. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.