The funds involved are proprietary funds owned and managed by UBS. However, many investors apparently relied on advice from UBS to invest in the funds, which are leveraged, and then to borrow money against the bonds. Other investors were allegedly encouraged to borrow money to buy the bonds, and they borrowed the money from a UBS affiliate! When the bonds declined in value, the UBS affiliate demanded repayment of the related loan, which the investors could not pay, because the funds were in those very bonds, which had now declined in value.
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