Investment fraud lawyers at the Law Office of Christopher J. Gray P.C. recently filed a securities arbitration claim with the Financial Industry Regulatory Authority regarding UBS Puerto Rico investments. This case, which was filed on behalf of a retiree, focuses on one of a group of closed-end funds structured by UBS Puerto Rico, known as the Puerto Rico Fixed Income Fund I.
According to the allegations stated in the claim, Fund I was marketed and sold as a safe fixed-income investment, and was primarily invested in bonds issued by the Puerto Rican government. However, according to securities arbitration lawyers, because these funds suffered heavy exposure to the Puerto Rico government-issued bonds, there were substantial risks associated with the fund’s concentration these bonds in the event that they lost value. Due to their leveraged exposure to Puerto Rico government bonds, the value of the close-end funds has significantly declined as the underlying municipal bonds have dropped in price.
Fund I had a stated value of $8.55 per share as of July 2013. However, the value per share dropped to $6.06 in September and, as of October 1, shares of Fund I were only valued at $3.73. There are 23 closed-end funds currently in question, some of which have lost more than half their value, according to recent reports. Some of the funds currently being investigated by investment fraud lawyers are:
- Puerto Rico Mortgage Backed & US Govt. Fund
- Puerto Rico Fixed Income Funds I-VI
- Puerto Rico AAA Portfolio Bond Funds I and II
- Puerto Rico AAA Portfolio Target Maturity Fund
- Puerto Rico Investors Bond Fund II
- Puerto Rico Investor’s Tax-Free Funds I-VI
- Puerto Rico GNMA &US Gov. Target Maturity Fund
- Puerto Rico Tax-Free Target Maturity Fund I and II
- Tax-Free Puerto Rico Target Maturity Fund
- Tax-Free Puerto Rico Funds I and II
If you suffered significant losses as a result of the improper recommendation of, or an over-concentrated investment in, one of the Puerto Rico closed-end funds, you may be able to recover your losses through securities arbitration. To find out more about your legal rights and options, contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 for a no-cost, confidential consultation.