UBS has been fined €250,000 by Luxembourg's financial regulator, the CSSF, due to violations related to the management of investments in Greensill funds by Credit Suisse.
Credit Suisse encouraged investors to invest in Greensill Capital, which resulted in significant financial losses when the company collapsed.
The CSSF's investigation found serious deficiencies in compliance with legal and regulatory requirements, particularly regarding conflicts of interest and asset valuation practices.
The fine was imposed for breaches that occurred before UBS acquired Credit Suisse in 2023.
The CSSF's inspection revealed "serious and persistent breaches" related to the sub-funds invested in Greensill, leading to action against UBS.
The CSSF's report highlighted areas where Credit Suisse failed to meet regulatory standards, including lack of due diligence on the portfolio manager and issues with managing conflicts of interest.
Credit Suisse also breached asset valuation regulations, with inadequate policies and procedures.
The deficiencies in asset valuation practices undermine investor confidence.
Investors affected by the losses have challenged UBS's redress offer and sought access to fund documents for restitution, but these requests have been denied.
The regulatory fine on UBS emphasizes the importance of financial institutions managing investor funds and adhering to regulatory standards.
The implications for UBS's management practices will be closely scrutinized by regulators and investors.