Almost four years after Swiss-based firms UBS and Credit Suisse got into a spat over the fate of Credit Suisse’s U.S.-based financial advisors, a Finra arbitration panel has ruled UBS is on the hook for $9 million in compensatory damages to its rival, according to news reports.
Credit Suisse opted to get out of the U.S. wealth management business in 2015 and in October of that year reached an agreement with Wells Fargo to give a new home to its U.S.-based financial advisors.
By the beginning of November, however, Credit Suisse brokers jumped ship to competitors including Merrill Lynch, Morgan Stanley and UBS. And “within weeks” UBS became home to 70 of the 300 relationship managers who were supposed to go to Wells Fargo, a person familiar with the matter said at the time, according to Bloomberg.
Credit Suisse filed its claim against UBS in November 2015, seeking damages “far in excess of ten million dollars,” according to the arbitration award document posted by the industry’s self-regulator this week.
The Finra panel ruled that UBS must pay Credit Suisse $9 million without elaborating on its reasoning, the news service writes.
Credit Suisse says the ruling confirms its “view that UBS engaged in serious misconduct in connection with its raid of Credit Suisse employees and materials privy to Credit Suisse,” according to Bloomberg.
UBS, meanwhile, took solace in the size of the award compared to what Credit Suisse originally sought.
“UBS believes that these claims were without merit and that this is a bad decision that is out of line with the applicable law,” the bank said in a statement cited by the news service. “While we don’t believe any award was justified, UBS notes that the claimant received only a fraction of what it sought.”