This Tuesday the directory of the Central Bank of Uruguay (BCU) decided the preventive intervention with the suspension of activities of two brokerage companies bag: Securities Custody and United Brokers SA. The resolution responds to “significant losses” reported by up to 400 people.
As explained by the BCU, these losses suffered by customers were not noticed in a timely manner by the companies.
The bank explained that, although in principle they are not the same company, both are linked. In addition, they share shareholders, senior staff and part of the commercial and administrative staff.
“For the purposes of carrying out any operation, including commercial ones, the representation of the intervened entities must be exercised jointly by their statutory authorities and the intervener. The meetings agreed with the clients to inform them of the situation are maintained in all its terms. It is also reported that the channels of communication with the companies continue to be the same”, indicated the BCU.
Up to 400 complainants
As indicated The Observer, between 300 and 400 people who were clients of Securities Custody reported suffering losses of thousands of dollars. In some cases these amounted to hundreds of thousands.
“The significant losses suffered by clients who operate under the free administration modality and have an investment profile agreed with them under the ‘aggressive’ rating (approximately 80% of their client portfolio), resulting from operations sales of put options at strike prices much higher than the prices of the shares, underlying the put option contracts, that were observed in the market beginning in November 2021, determining that in the period of June 30 2021 to May 31, 2022. The aforementioned accounts will go from a total balance of approximately US$110,000,000 to US$18,000,000”, indicates the BCU.
According to the entity, these losses were not reflected in the account statements issued to customers. In this sense, until May 31 of this year, customers saw a balance of US$ 59 million, when in reality it was US$ 18 million.
