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Matthew Buchsbaum Embroiled in $1.2 Billion Dispute Alleging Misrepresentation

Feb 15, 2022 Investor Disputes

Matthew Buchsbaum (CRD #:2220565), a broker and investment advisor registered with UBS Financial Services, is involved in an investor dispute, according to his BrokerCheck record, accessed on January 20, 2022. 

Investor Allegations

According to the allegations filed on December 10, 2021, Matthew Buchsbaum was named in a putative class action seeking to recover losses incurred by UBS. The investor alleges that the firm failed to accurately disclose the risks associated with a Yield Enhancement Strategy (YES). The investor is seeking $1,200,000,000

Negligence Allegations

On March 13, 2019, Matthew Buchsbaum was the subject of an investor dispute. According to the allegations, Matthew Buchsbaum was negligent, breached his fiduciary duty, breached his contract; and failed to supervise. FINRA awarded the investor $691,205.67. You can read the award here

Unsuitability and Misrepresentation Allegations

Between 2019 and 2021, Matthew Buchsbaum was involved in 26 unsuitability disputes. According to the allegations Matthew Buchsbaum, recommended and misrepresented an unsuitable overlay strategy investment leading to losses.

Pending Disputes

16 disputes are still pending. Investors are seeking a total of approximately $39,745,000. These disputes allege unsuitable investment recommendations and misrepresentation. 

Settled Disputes

Six disputes have since been settled. These cases collectively settled for approximately $16,000,000.

Denied Disputes

Two cases have been denied, but investors should know that firms can deny disputes without external review. Investors should also know that they can still pursue FINRA arbitration and recover their losses following a denial.

Unsuitability and Misrepresentation

Two issues that investors should be aware of are unsuitability and misrepresentation. 

What is Unsuitability?

Unsuitability is a term used to describe recommendations and trades that are inconsistent with the customer’s goals and investment profile.

Under FINRA Rule 2111, a customer’s investment profile includes the customer’s:

  • Age
  • Financial situation and needs
  • Tax status
  • Investment objectives
  • Investment experience
  • Risk tolerance.

Brokers should take into account any risk tolerances or goals the person has expressed before making recommendations, and take note if those preferences change over time. 

Investors who rely on their brokers for recommendations may be able to recover their losses through FINRA arbitration.

What is Misrepresentation?

Misrepresentation is a common problem in the securities industry. It usually occurs when an investment broker makes false or misleading statements about a financial product in an effort to persuade their customer to invest. 

Did you know that any of the following can be considered misrepresentation or omission?

  • Inadequate due diligence concerning security offerings
  • Failure to disclose all material risks
  • Failure to disclose all transaction costs
  • Unrealistic presumptions for investment projections
  • Inaccurate investment performance calculation

Misrepresentations and omissions concerning material facts in investment recommendations deprive investors of the information they need to assess risks associated with a particular investment. FINRA Rule 2020 prohibits brokerage firms and stockbrokers from making material misrepresentations or inducing people into buying investments with false statements about their potential benefits. This unethical conduct also violates FINRA Rule 2010, which states that brokers must uphold high standards of commercial honor. 

Losses that can be attributed to a stockbroker’s material misrepresentations of facts may result in a viable securities arbitration claim for damages.

Background Information

Matthew Buchsbaum has passed the following exams:

  • Series 66 – Uniform Combined State Law Examination
  • Series 63 – Uniform Securities Agent State Law Examination
  • SIE – Securities Industry Essentials Examination
  • Series 7 – General Securities Representative Examination

Matthew Buchsbaum is a registered broker in 53 States and Washington DC. He is also a registered investment advisor in four states.

Other than UBS Financial Services, Matthew Buchsbaum has also worked with the following firms:

  • Credit Suisse Securities (USA) (CRD#:816)
  • Donaldson, Lufkin & Jenrette Securities Corporation (CRD#:7560)
  • G. Edwards & Sons (CRD#:4)

   Kurta Law Can Help

If you have worked with Matthew Buchsbaum and have concerns about your investments, don’t hesitate to contact us today at 877-600-0098 or for a free consultation.

For nearly 20 years, Kurta Law has advocated for investors to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm and exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf.