THE COMPLAINT AROSE OUT OF THE SALE OF AN AUCTION RATE SECURITY (ARS) THAT WAS MADE PRIOR TO THE WIDESPREAD ILLIQUIDITY IN THE ARS MARKET THAT OCCURRED IN FEBRUARY 2008.

$13,500,000.00

I STRONGLY DISAGREE WITH UBS ADDING THIS CUSTOMER COMPLAINT TO MY RECORD. I INTEND TO VIGOROUSLY PURSUE HAVING IT REMOVED. THE COMPLAINT AROSE IN CONNECTION WITH THE INDUSTRY WIDE BREAKDOWN OF LIQUIDITY IN THE MARKET FOR AUCTION RATE SECURITIES ("ARS"). THE FIRM AGREED TO REPURCHASE THE ARS SECURITIES AT ISSUE AT PAR VALUE FROM THE CLIENT PURSUANT TO A GLOBAL REPURCHASE AGREEMENT IT ENTERED INTO WITH SEVERAL REGULATORY BODIES. THIS WAS NOT A SETTLEMENT OF A DISPUTE BETWEEN THE CLIENT AND THE REPRESENTATIVE AND WAS NOT BASED ON THE MERITS OF THE CLIENT'S SPECIFIC CONCERNS OR ANY FINDING OF FAULT OR WRONGDOING BY THE NAMED REPRESENTATIVE. THE NAMED REPRESENTATIVE WAS NOT A PARTY TO, AND DID NOT AGREE TO OR PARTICIPATE IN, THE REPURCHASE AGREEMENT BETWEEN THE FIRM AND THE RELEVANT REGULATORY BODIES. THE NAMED REPRESENTATIVE DID NOT MAKE ANY PAYMENTS TO THE CLIENT AND THE NAMED REPRESENTATIVE WAS NOT ASKED TO AND DID NOT CONTRIBUTE TO THE SETTLEMENT AMOUNT. THE LISTED "SETTLEMENT AMOUNT" REPRESENTS ONLY THE GROSS INITIAL PAR VALUE OF THE ARS POSITION AND DOES NOT TAKE INTO ACCOUNT THE ACTUAL VALUE OF THE ARS POSITION AT THE TIME THE FIRM RECEIVED IT BACK FROM THE CLIENT IN CONNECTION WITH THE SETTLEMENT. THIS MATTER IS BEING REPORTED AS A SETTLEMENT PURSUANT TO THE REQUIREMENTS OF FINRA REGULATORY NOTICE 09-12.

CLIENT ALLEGES HE WAS TOLD THAT THE STUDENT LOAN BACKED AUCTION RATE SECURITIES WERE SAFE INVESTMENTS AS THEY WERE BACKED BY US GOVERNMENT GUARANTEE. CLIENT FURTHER ALLEGES HE WAS NEVER INFORMED THAT THESE AUCTIONS COULD FAIL AND THAT THERE WAS NO DISCLOSURE THAT THE INTEREST RATES INVOLVED COULD BE REDUCED OR RESET. DAMAGES ESTIMATED TO BE IN EXCESS OF $5,000.

$5,000.00

$300,000.00

I STRONGLY DISAGREE WITH UBS ADDING THIS CUSTOMER COMPLAINT TO MY RECORD. I INTEND TO VIGOROUSLY PURSUE HAVING IT REMOVED. THE ALLEGATIONS MADE BY THE CLIENT ARE UNFOUNDED. DURING CLIENT CALLS IN WHICH ANOTHER FA WAS INVOLVED, ASPECTS OF THE AUCTION RATE SECURITIES MARKET WERE DISCUSSED IN DETAIL. THE AUCTION PROCESS, THE RISKS ASSOCIATED WITH CASH ALTERNATIVE INVESTMENTS, PARTICULARLY THE LIQUIDITY RISK ASPECT OF THE SECURITIES AS WELL AS THE TYPES OF COLLATERAL WERE ALL DISCUSSED. BASED ON THE HISTORICAL LIQUIDITY OF THE PRODUCT AND MARKET FUNCTIONALITY AT THE TIME OF PURCHASE, THIS PRODUCT, WHICH WAS PRESENTED TO THE CLIENT AS A CASH ALETRNATIVE, WAS SUITABLE BASED ON HIS RISK TOLERANCE, INVESTMENT OBJECTIVE, NEED FOR LIQUIDITY AND STATED DESIRE FOR CURRENT INCOME. THE CLIENT AGREED AND MADE THE DECISION TO INVEST IN THE AAA RATED ARS. FOR THE PAST 20 YEARS, THE AUCTION RATE SECURITIES MARKET HAS PROVIDED A RELIABLE SOURCE OF LIQUIDITY AND RETURN FOR INVESTORS. THIS COMPLAINT AROSE BECAUSE OF UNPRECEDENTED MARKET EVENTS THAT CAUSED THE DISRUPTION OF LIQUIDITY IN THE MARKET FOR AAA RATED AUCTION RATE SECURITIES AND ANY ALLEGED DAMAGES WERE NOT CAUSED BY ANY WRONGDOING ON THE PART OF THE FINANCIAL ADVISOR.MATTER WAS RESOLVED THROUGH THE FIRM'S OFFER VIA PROSPECTUS TO REPURCHASE THE ARS POSITION AT PAR.