UBS Fined $1.435B for 2008 Financial Crisis Fraud
• UBS is facing a hefty fine from the US Department of Justice for its role in the Great Financial Crisis of 2008.
• The DOJ says UBS has agreed to pay $1.435 billion in penalties to settle allegations that the bank defrauded investors while underwriting and issuing residential mortgage-backed securities (RMBS).
• UBS joins a slew of other institutions in paying penalties related to the 2008 crisis, including Bank of America, Barclays, Goldman Sachs and JPMorgan.
UBS Facing Fine from US DOJ
The banking giant UBS is facing a hefty fine from the US Department of Justice for its role in the Great Financial Crisis of 2008. The DOJ says UBS has agreed to pay $1.435 billion in penalties to settle allegations that the bank defrauded investors while underwriting and issuing residential mortgage-backed securities (RMBS) in 2006 and 2007.
False Statements Alleged
The government says it’s also determined that contrary to bank’s representations, UBS knew that the property values associated with many of the securitized loans were unsupported, but issued them anyway despite doing extensive due diligence. Many of the loans backing UBS’ RMBS did not comply with loan underwriting guidelines, which the bank was aware of, says the DOJ.
Household Loss Estimated at $19 Trillion
According to the DOJ, the UBS settlement means that in total, the US government has collected just over $36 billion in penalties in relation to this crisis. However, some reports estimate that total household loss due to this event was as high as $19.2 trillion – not adjusting for inflation.
Vanita Gupta Comments
Says Associate Attorney General Vanita Gupta,”In wake of 2008 financial crisis people all across country experienced financial ruin and emotional devastation, and many are still recovering nearly 15 years later.” She added saying,”As this settlement demonstrates department & our partner agencies remain committed holding accountable those who break law & undermine wellbeing American families.”
Other Companies Fined Over Crisis
UBS joins a slew other institutions paying penalties related crisis including Bank America ,Barclays ,Goldman Sachs & JPMorgan .
