The Securities Arbitration Law Firm of Klayman & Toskes Files $13.6 Million Claim Against Morgan Stanley Smith Barney on Behalf of a UPS Employee As It Continues To Investigate Claims on Behalf of Current and Former UPS Employees
NEW YORK--(BUSINESS WIRE)--The Securities Arbitration Law Firm of Klayman & Toskes (“K&T”), www.nasd-law.com, announced today that it filed a claim against Morgan Stanley Smith Barney (“Smith Barney”) on behalf of a UPS (NYSE: UPS) employee for losses sustained as a result of maintaining a concentrated, leveraged position in UPS stock. The suit was filed with FINRA’s arbitration department, and seeks damages of $13,600,000.
According to the Claim, the Claimant worked over 37 years with UPS and accumulated shares of the company through UPS’ Employee Stock Purchase Plan and Managers Incentive Program. The Claimant opened a Hypothecation Loan (“hypo loan”) whereby the UPS stock served as collateral. In opening an account with Smith Barney, Claimant’s hypo loan was converted to a portfolio credit line with CitiBank. While Smith Barney’s bank division loaned Claimant money using his UPS stock as collateral, Smith Barney failed to recommend a collar and/or protective put option as a risk management strategy to protect Claimant’s concentrated position in UPS stock. Smith Barney, looking to make money on the loan, facilitated the unsuitable investment strategy of borrowing against a concentrated stock position without a collar and/or protective put option in place. By failing to protect the concentrated position and/or recommend risk management strategies, Claimant received collateral calls which triggered the sale of his UPS stock.
The sole purpose of this release is to investigate, on behalf of our clients, the sales practices of Smith Barney in connection with the handling of concentrated, leveraged stock portfolios for UPS employees. Current and former UPS employees who held accounts with Smith Barney and have information relating to the manner in which the firm handled their concentrated, leveraged portfolios, are encouraged to contact Steven D. Toskes, Esquire or Jahan K. Manasseh, Esquire of Klayman & Toskes, P.A., at 888-997-9956, or visit us on the web at www.nasd-law.com.