UBS Fined $1.5 Million Over Regulatory Breaches in Hong Kong
(Bloomberg) -- Hong Kong’s securities regulator slapped a total of HK$11.55 million ($1.5 million) fine on UBS Group AG over regulatory breaches, almost 1 1/2 years after lifting a ban on the Swiss bank from sponsoring initial public offerings in the city.
UBS and UBS Securities Asia were fined HK$9.8 million and HK$1.75 million respectively, the city’s Securities and Futures Commission said in a statement on Tuesday.
The Swiss bank was found in breach of failing to include proper disclosures of financial interests in some Hong Kong listed companies covered in its research reports between May 2004 and May 2018.
UBS also failed to disclose to 15 clients the “stop loss event” feature of a structured note and to assure itself that clients understood the risks associated with that feature before selling them the note between October 2017 and February 2020, the SFC said. UBS has offered to compensate the affected clients.
“The SFC considers that UBS failed to act with due skill and care and put in place adequate systems and controls to ensure compliance with the applicable regulatory requirements,” according to the statement.
The fine, which took into consideration UBS’s remedial actions, comes as the bank was recovering from a ban imposed in 2019 by the SFC for its mismanagement of three IPOs in Hong Kong. UBS was fined about HK$375 million in the IPO probe.
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