ZURICH & BASEL, Switzerland--(BUSINESS WIRE)--
UBS (NYSE:UBS) (SWX:UBSN) announced today that it has approved entering into resolutions with the US Department of Justice (DOJ), the Board of Governors of the Federal Reserve System (Fed) and the Connecticut Department of Banking (CT DOB) in their investigations of the global foreign exchange (FX) markets. This follows the firm's resolutions last November with the Swiss Financial Market Supervisory Authority, UK Financial Conduct Authority and the US Commodity Futures Trading Commission. The bank continues to cooperate with ongoing investigations by other authorities in this industry-wide matter, which include investigations of individuals.
As a result of today's resolutions, UBS has not been criminally charged for FX conduct. The DOJ will also not file any charges concerning its investigations into the firm's V10 FX-related structured products and its precious metals business. In resolving the FX matter with the DOJ, UBS received conditional immunity from prosecution for Euro/USD collusion from the Antitrust Division, which will also not prosecute UBS for any other FX conduct. This immunity reflects UBS's role as the firm that first reported potential misconduct to the DOJ, and the full cooperation provided to the DOJ and other authorities throughout the world.
The DOJ used its sole discretion to terminate its 2012 Non-Prosecution Agreement with UBS related to LIBOR. As a consequence, UBS AG has agreed to plead guilty to one count of wire fraud for conduct in the LIBOR matter, pay a USD 203 million fine and accept a three-year term of probation. This guilty plea for LIBOR by UBS AG relates to the same conduct that was the basis of the plea by the firm's Japanese subsidiary when the firm resolved its LIBOR issues in 2012.
The Fed and the CT DOB jointly issued a cease and desist order finding that UBS engaged in unsafe and unsound business practices relating to its FX business. UBS will pay a penalty of USD 342 million to the Fed and has agreed to undertake a series of remedial measures.
The firm is fully provisioned for these resolutions. As a consequence, they will have no financial impact on second quarter 2015 results.
UBS Chairman Axel A. Weber and Group Chief Executive Officer Sergio P. Ermotti said: "The conduct of a small number of employees was unacceptable and we have taken appropriate disciplinary actions. We made significant investments to strengthen our control framework and compliance programs. We self-detected this matter and reported it to the US Department of Justice and other authorities. Our actions demonstrate our determination to pursue a policy of zero tolerance for misconduct and a desire to promote the right culture in our industry."
Cautionary statement regarding forward-looking statements
This document contains statements that constitute “forward looking statements.” While these statements represent UBS’s judgments and expectations concerning the matters described, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from UBS’s expectations. Additional information about those factors is set forth in documents furnished and filings made by UBS with the US Securities and Exchange Commission, including the first quarter 2015 report and Annual Report on Form 20-F for the year ended 31 December 2014. UBS specifically prohibits the redistribution or reproduction of this material in whole or in part without the prior written permission of UBS, and UBS accepts no liability whatsoever for the actions of third parties in this respect.
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