The UBS share value dropped in the wake of news that the U.S. Department of Justice intensified a probe into possible compliance issues that may have helped Russian clients to sidestep Western sanctions. On Wednesday, UBS shares were 3.19% in the red at midday EDT.
UBS shares decrease after US Department of Justice investigation
Bloomberg News reported that the U.S. Department of Justice launched an all-out probe regarding sanction violations by Credit Suisse. As UBS merged with Credit Suisse earlier this year, it invariably falls under the authority’s spotlight, too.
The Swiss government orchestrated the UBS emergency takeover to prevent an economic meltdown in Switzerland and the global impact the fall of Credit Suisse would have had. UBS bought Credit Suisse for a bargain at $3.25bn.
When the report of the U.S. Department of Justice investigation surfaced, UBS shares plunged by nearly 8%. It managed to claw its way back to a 3.4% negative later during the day.
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UBS’s latest financial report, published at the end of August, confirmed that its sanction schemes align with sanctions imposed by multiple jurisdictions. This includes that of the United Nations, Switzerland, the UK, and the United States.
This report also mentioned that law enforcers contacted its Credit Suisse branches in Britain, Netherlands, France, and Belgium about cross-border banking and wealth management. The UBS further stated that:
Credit Suisse has conducted a review of these issues, the UK and French aspects of which have been closed, and is continuing to cooperate with the authorities.
