Background of the Losses
UBS is facing increased pressure: Several wealthy Swiss clients suffered substantial losses from investments in risky dollar derivatives. These losses are attributed to the sharp decline of the US dollar in early April 2025. The drop was triggered by tariff announcements from then-US President Donald Trump, which, in turn, led to significant margin calls on structured financial products.
Legal Consequences
As a result of these financial losses, several criminal complaints have been submitted to the Zurich public prosecutor’s office. These complaints target “unknown parties” due to potential violations of the law against unfair competition and are currently under preliminary examination. The situation could lead to legal difficulties for UBS.
Damage Control and Image
UBS is trying to limit the damage and has reportedly already offered about 100 clients so-called “goodwill payments” as compensation. These compensations vary significantly in scope; some clients received up to 90 percent of their losses back, while others were refunded considerably lower amounts. Although the number of affected clients is relatively small, these payments could significantly impact the bank’s image.
In summary, UBS faces both legal and reputational consequences from the scandal surrounding loss-making dollar derivatives.