UBS Broker Allegedly Promoted Short Selling Tesla Stock
According to an article in AdvisorHub today, a group of investors have reportedly sued UBS and a top advisor in Madison, Wisconsin for $23 million after the broker purportedly “repeatedly promoted the idea of short selling” shares of the electric car company Tesla, Inc.
The group of investors which included four couples and an individual, reportedly filed a FINRA arbitration claim alleging that their broker, Andrew Burish, of UBS’ the Burish Group, made Tesla short-selling recommendations in 2019 and 2020. The claimants seek actual damages of $23 million as well as unspecified punitive damages and costs.
According to the complaint, UBS and Burish allegedly breached fiduciary duty and violated FINRA’s suitability rule. The suit also claims UBS failed to supervise the broker.
Burish’s alleged recommendations reportedly “focused on his conviction that lots of money would be made because Tesla common stock was overvalued and certain to lose its value,” and there was allegedly no balanced view of the risk of loss provided, according to the complaint.
Tesla stock was trading at close to $60 per share in early 2019 and since then its price has skyrocketed to more than $720 per share as of this week.
A UBS spokesman said in a statement that the plaintiffs are “sophisticated investors” who had a tolerance for the risks associated with the strategy, according to the article on AdvisorHub.
Potential Lawsuits to Recover Financial Losses
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