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In the Matter of UBS Financial Services Incorporated of Puerto Rico Admin. Proc. File No. 3-16846

Oct. 6, 2022

In the Matter of Ramiro L. Colon, III
Admin. Proc. File No. 3-16847

On September 29, 2015, the Commission instituted and simultaneously settled two related administrative proceedings (collectively, the “Orders”) against UBS Financial Services Incorporated of Puerto Rico (“UBSPR”) and its former branch office manager, Ramiro L. Colon, III (“Colon”) (collectively, the “Respondents”). In the Orders, the Commission found that, from at least 2011 through 2013, UBSPR, through Colon, violated the federal secur”ities laws by failing to supervise Jose Ramirez, Jr., a registered representative and associated person of UBSPR, who engaged in conduct that violated the anti-fraud provisions of the securities laws. In their respective Orders, the Commission ordered UBSPR to pay a total of $15,000,000.00 in disgorgement, prejudgment interest, and civil money penalties and Colon to pay a $25,000.00 civil money penalty. The Commission created a Fair Fund, pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, as amended, for UBSPR's payments, so that the penalties, along with the disgorgement and interest, could be distributed to harmed investors (the “Fair Fund”). Colon's penalty was ordered to be held by the Commission, pending a decision whether the Commission, in its discretion, would seek to distribute such funds or transfer them to the U.S. Treasury. See the Commission's orders: Release Nos. 34-76013 and 34-76014.

On February 12, 2016, the Commission issued an order appointing Damasco & Associates LLP (“Damasco”) as the Tax Administrator of the Fair Fund. Damasco was acquired by Miller Kaplan Arase LLP and on June 30, 2017, the Commission issued a notice of name change for the Tax Administrator.

On November 3, 2016, the Commission issued an order appointing Rust Consulting, Inc. as the Fund Administrator of the Fair Fund and set the administrator's bond amount. See the Commission's order: Release No. 34-79227

On April 27, 2017, the Commission published a notice of the proposed plan of distribution and opportunity for comment and simultaneously published the proposed plan of distribution (“Proposed Plan”). The notice provided the public with 30 days to submit their comments on the Proposed Plan. See the Commission's notice: Release No. 34-80535 and the Proposed Plan

On July 7, 2017, the Commission issued an order consolidating Colon's civil money penalty with the Fair Fund and approving the plan of distribution (“Plan”). See the Commission's order: Release No. 34-81100 and the Plan

The Plan provides that the distribution of the Fair Fund shall be made to compensate investors who, based on Ramirez's material misrepresentations, purchased Eligible Securities from January 1, 2011 through September 13, 2013 and suffered an Eligible Loss Amount.

The claim form may found at Claim forms must be postmarked no later than: March 9, 2018.

Payments were mailed to Eligible Claimants on August 4, 2020.

On July 28, 2021, the Commission issued an order approving the disbursement of $15,355,456.19 from the Fair Fund for distribution to eligible investors. See the Commission’s Order: Release No. 34-92512.

The distribution in this matter was closed on February 22, 2023, when the Commission approved the final accounting and issued an order authorizing the disposition of funds remaining in the Fair Fund, and transferring any future funds to the U.S. Treasury, discharging the Fund Administrator, canceling the Fund Administrator’s bond, and terminating the Fair Fund.  See the Commission’s Order: Release No. 34-96964.

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