UBS Veteran Accuses Firm Of Skimming Client Fees; Files FINRA Complaint

In a serious legal claim that  raised eyebrows everywhere, a long-tenured UBS advisor has accused the firm of skimming commission-based fees from retirement accounts that he manages. In fact, he believes that those funds have not only been skimmed but have also been redirected to ‘plan sponsors’ that affiliate with the firm.

Via AdvisorHub: 

Peter de Castro, 71,  resigned from UBS last year to join RBC Wealth Management-U.S. because of “unethical practices” that failed to credit him for the revenue it derived from his largely fee-based practice, according to the claim that he filed with the Financial Industry Regulatory Authority in mid-September.”

“The practices violated New York labor laws, California wage laws and ERISA laws related to withholding of retirement account compensation, it said.”

“The San Francisco-based broker is seeking more than $1 million in withheld compensation and $1 million in punitive damages, asserting legal theories that include misrepresentation, “conversion” of money owed to him in commissions and deferred comp, and breach of fiduciary duty.”

If true this could have sweeping repercussions for UBS and any other firms that may have engaged in a practice like this. Obviously, time will tell if any of these allegations are true (and frivolous lawsuits are filed all the time), but the nature and notion of a 71-year-old advisor attempting to recoup lost wages sound ominous. 

Given that he is essentially moments away from retirement, why would he engage in a legal battle with a global banking behemoth? That question is worth pondering. Should there be some truth behind his filings, this could be the beginning of something serious.

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