UBS May Be Sued by SEC Over Puerto Rico Closed-End Bond Funds

UBS AG may be sued by the U.S. Securities and Exchange Commission over the sale of mutual funds that bought $1.5 billion in bonds Switzerland’s largest bank had underwritten in Puerto Rico.

The SEC’s Miami office issued a Wells notice to UBS Financial Services Inc. of Puerto Rico and UBS Financial Services Inc. regarding “secondary market trading and associated disclosures” of closed-end funds sold in the Caribbean island in 2008 and 2009, the Zurich-based firm said in a report to investors. The notification typically lets recipients respond to investigators’ claims before the agency approves legal action. The SEC may decide to not pursue a case.