Financial Times FT.com

UBS faces civil charges over securities sales

By Rebecca Knight in Boston

Published: June 27 2008 03:00 | Last updated: June 27 2008 03:00

Massachusetts' top securities regulator yesterday filed civil fraud charges against UBS for allegedly selling investments the Swiss bank knew were not safe.

According to a 101-page complaint filed by William Galvin, Massachusetts' secretary of state, UBS representatives told investors that auction-rate securities - preferred shares in closed-end mutual funds, long-term debt issued by local governments or backed by a pool of student loans - "were safe, liquid 'cash alternatives' ".

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