Securities attorneys at Klayman & Toskes say they are investigating claims of UBS Financial Services customers who purchased the UBS Willow Fund, a private hedge fund formed in 2000. In October of 2012, investors were notified that the Fund would be liquidated. With the massive losses losses reportedly sustained by investiors in this UBS hedge fund, it's wise for RIAs to be aware of the case.
According to a press release, "many investors were advised that the Fund was a safe, low risk product." The Fund has declined about 80%.
"K&T is investigating whether UBS adequately disclosed the risks associated with the Willow Fund," says the release, "as well as whether investors’ portfolios were over-concentrated in the Fund."
The individual brokers and advisors who sold the Willow Fund are not the target of this investigation.
K&T is looking into UBS’s conduct in connection with its marketing of the Fund to its customers, and whether the Willow Fund deviated from its disclosed strategy of investing in distressed debt and instead started speculating in foreign sovereign debt credit default swaps. It is believed that credit default swaps eventually led to the collapse of the fund, and caused investors to lose a substantial portion of their investment.