SAN JUAN, Puerto Rico, Oct. 8, 2013 (GLOBE NEWSWIRE) -- The Law Firms of Sonn & Erez and Aldarondo & López Bras, based in Miami, Florida and Guaynabo, Puerto Rico, respectively, were retained by investors to sue UBS Puerto Rico over sales practices related to Puerto Rico Bonds and UBS leveraged closed end bond funds. Many investors in the closed end and open end Puerto Rico related bond funds may have a claim against UBS, including fraud, unsuitable investment recommendations, and other related actions.
"We believe many conservative, wealthy clients, and elderly clients in Puerto Rico were sold UBS closed end bond funds, or Puerto Rico bonds on margin, without full disclosure of the risks associated with these investments, including the significant risk of leverage," said Jeffrey Sonn, of Sonn & Erez. "In my opinion, many clients were unaware that there was an imbalance in the supply and demand of Puerto Rico bonds, and that the liquidity of the bond market in Puerto Rico had likely been weak for some time. Without sufficient liquidity, the closed-end bond funds bonds that concentrated in Puerto Rico debt were at significant risk of loss when the market began to deleverage and margin calls were issued," added Eliezer Aldarondo-Ortiz, of Aldarondo & López-Bras, in Guaynabo, P.R. "The recent downturn, in my opinion, was related to the overuse of leverage in the bond funds, and the unsuitable use of margin to buy bonds and bond funds that concentrated in just one locale, Puerto Rico," said Jeff Erez, of Sonn & Erez. "Any time you concentrate your bond purchase in one location, you create an unsuitable concentrated risk of loss," added Erez.
For clients who invested in the following funds, they may have a claim for losses through arbitration, a private, out of court procedure through which claims can be filed for some, or all, of the investment losses: Tax-Free Puerto Rico Fund, Tax-Free Puerto Rico Fund II, Tax-Free Puerto Rico Target Maturity Fund, Puerto Rico AAA Portfolio Target Maturity Fund, Inc., Puerto Rico AAA Portfolio Bond Fund, Puerto Rico AAA Portfolio Bond Fund II, Puerto Rico GNMA & U.S. Government Target Maturity Fund, Puerto Rico Mortgage-Backed & U.S. Government Securities Fund, Puerto Rico Fixed Income Fund, Puerto Rico Fixed Income Fund II, Puerto Rico Fixed Income Fund III, Puerto Rico Fixed Income Fund IV, Puerto Rico Fixed Income Fund V, Puerto Rico Fixed Income Fund VI, Puerto Rico Short Term Investment Fund, Multi-Select Securities Puerto Rico Fund, UBS IRA Select Growth & Income Puerto Rico Fund, Puerto Rico Investors Family of Funds, Puerto Rico Investors Tax-Free Fund, Puerto Rico Investors Tax-Free Fund II, Puerto Rico Investors Tax-Free Fund III, Puerto Rico Investors Tax-Free Fund IV, Puerto Rico Investors Tax-Free Fund V, Puerto Rico Investors Tax-Free Fund VI, Puerto Rico Tax-Free Target Maturity Fund, Puerto Rico Tax-Free Target Maturity Fund II, Inc., Puerto Rico Investors Bond Fund I.
Sonn added: "UBS financial advisors are not targets and we will not be naming them in any FINRA arbitration claims. We believe that responsibility is with UBS, and other firms that sold Puerto Rico bonds and bond funds using leverage and/or margin."
Jeffrey Sonn, Esq. () Jeffrey Erez, Esq. () Southeast Financial Center, Suite 4330 Miami, FL 305-428-8530 Eliezer Aldarondo-Ortiz, Esq. () Eliezer A. Aldarondo-Lopez, Esq. () 16 Las Cumbres Ave. (Road 199) Suite 400 Guaynabo, P.R. 787-474-5447
