May 24 (Bloomberg) -- UBS AG, Switzerland’s biggest bank, was sued for fraud in New York, accused of misleading investors in a group of collateralized debt obligations.
UBS made misrepresentations about the CDOs’ risk, leading to losses of at least $331 million, a group of special purpose entities that made the investments said in a complaint filed yesterday in New York State Supreme Court.
“Aware that the end of its lucrative CDO business was fast approaching, UBS resorted to increasingly aggressive tactics to ensure that the CDOs it was creating could be sold to investors, even if this required concealing the true nature and risk of the CDOs’ portfolios,” the plaintiffs said.
Christiaan Brakman, a spokesman for Zurich-based UBS, declined to comment on the complaint.
The case is Loreley Financing (Jersey) No. 4 Ltd. v. UBS Ltd., 651785-2012, New York State Supreme Court (Manhattan).
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