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UBS and Ex-Broker Ordered to Pay $805K to Client in Arbitration

By Alex Padalka April 12, 2018

A Finra arbitration panel has ordered UBS Financial Services and one of its former brokers to pay a client more than $805,000 for negligence and breach of fiduciary duty, among other claims, according to an award document published by Finra’s Office of Dispute Resolution.

Claimants Scott Feldman and the Scott H. & Janet J. Feldman Revocable Trust accused UBS and Michael James Keane, a broker with UBS’s Melville, N.Y., office, of negligence, misrepresentation, fraud, breach of fiduciary duty, breach of contract and unjust enrichment, according to the award.

The claim originally sought $1.2 million in consequential damages, $2.5 million in punitive damages, disgorgement of all fees, interest on damage awards, lawyers’ fees, litigation fees and more, Finra says. In response, Keane and UBS sought to dismiss all of the claims and expunge any reference to the case from Keane’s central registration depository records, both of which the panel denied, according to the award document.

Keane had started in the securities industry in 1968 with Merrill Lynch and was with UBS from 2007 to 2016, according to his BrokerCheck record.

He has nine customer disputes dating back to 2009, some of which have been settled while others have been denied and two are still pending. One of the pending disputes, from October 2017, alleges that from 2011 to 2017 Keane had disregarded a client’s instructions and invested in unsuitable risky energy stocks and master limited partnerships, for which the client is seeking $300,000, according to BrokerCheck.

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Another pending dispute, from November 2016, alleges that from 2008 to 2015 Keane recommended unsuitable investments in MLPs and energy stocks and then misrepresented the investments’ risks, for which the client is seeking $4.7 million in damages, according to BrokerCheck.