UBS Confronts U.S., French Lawsuits and Huge Potential Fines
- U.S. starts lawsuit related to mortgage-backed securities
- French financial prosecutor fine demand could be biggest ever
Photographer: Matthew Lloyd/Bloomberg
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UBS Group AG’s two biggest legal cases in years are entering the final stretch in a test of Chief Executive Officer Sergio Ermotti’s strategy of taking on French and U.S. authorities.
The Swiss bank was hit with a long-expected U.S. fraud lawsuit that accused it of fueling the 2008 financial crisis by deceiving investors who bought billions of dollars of risky mortgage-backed securities. In France, the state and prosecutors are seeking as much as 5.3 billion euros ($6 billion) in fines and damages over allegations it helped clients hide money from authorities. That would be easily the largest criminal penalty ever levied in the nation.