UBS - United ****** *****s

[dieseltaylor]

I am looking forward to this case of financial mis-selling:

As early as May 17, 2007, UBS had reason to believe that Moody’s was changing its methodology and that would result in the downgrading of certain asset-backed securities. (Exhs. 11, 17). UBS’s emails show that its employees met with Moody’s representatives to discuss the impact of the downgrades and when they should start downgrading.17 (Exh. 17). Thereafter on July 11, 2007, UBS employees had knowledge that Moody’s was going to downgrade CDOs by the end of the day.18 On July 26, 2007, UBS instructed its employees to “reduce cdos . . . no need to publicly relay this, but if you are close on something, [please] close it . . .[thanks] for your discretion.” (Exh. 34).

In response to that email, Morelli stated “[P]ursuit has dry gun powder but not tons of it.”19 Soon after on August 28, 2008, Morelli sent an email referencing the subject Notes, stating that he had “sold more crap to Pursuit.” (Exh. 49). The court finds that the problem was not confined to only the CDOs at issue in this PJR. For instance, on September 24, 2007, as the clock was running out on the investment grade ratings for its products, another UBS employee sent an email to a UBS director referencing another supposed “investment grade” rated CDO in their inventory, writing, “OK still have this vomit?” (Exh. 62).

http://ftalphaville.ft.com/blog/2009/09/11/71406/cave-vomiturus-sum/