Hong Kong’s Securities and Futures Commission reprimanded and fined UBS over regulatory breaches covering various areas including transparency client suitability.
The SFC fined UBS AG and UBS Securities Asia Limited HK$9.8 million ($1.26 million) and $1.75 million, respectively, over various regulatory breaches, according to a statement.
The issues covered areas ranging from lacking disclosures to client suitability issues.
Proper Disclosure
The SFC’s probe found that UBS failed to make proper disclosure of its financial interest in some Hong Kong-listed companies covers in its research reports for 14 years, between May 2004 and May 2018.
«The failure was caused by multiple data feed logic errors in a legacy data source used by UBS for tracking its shareholding positions,» the securities regulator said.
Client Suitability and Sales Process
The SFC also found that UBS failed to fulfill various processes across client suitability and sales.
It said the Swiss bank, in various time periods, failed to obtain «valid standing authorities» from clients who were not qualified as professional investors; record client order instructions; fully assess client derivatives knowledge; and disclose the «stop loss event» feature in a structured note.
«The SFC considers that UBS failed to act with due skill and care and put in place adequate systems and controls to ensure compliance with the applicable regulatory requirements,» the regulator said in the statement.
