UBS, the Swiss banking giant, allegedly duped a 77-year-old Chinese woman, who speaks no English and did not finish primary school, into buying high-risk, leveraged derivatives called “accumulators” that tanked in the global crisis, causing her to lose the equivalent of nearly $26 million, according to the woman’s attorney, as reported by CNBC.com.
UBS had the woman sign documents in English, including one that purported to describe her as a “professional investor.” UBS then entered the elderly, uneducated woman into 25 transactions in “accumulators” and charged her an “unwinding fee” of $6.1 million when she followed its instructions to sell securities to settle “her debt” (presumably a huge margin call). UBS apparently offered to pay her the equivalent of $1.29 million after some negotiations. The woman filed suit last Tuesday.
The real shocker is that such a story is not all that shocking anymore.