October 13, 2010
Bernstein Liebhard LLP is investigating sales practices relating to 1861 Capital Management leveraged municipal bond arbitrage. 1861 Capital Management focuses on municipal arbitrage to try to take advantage of differences between municipal bonds and other types of debt, including Treasury securities and corporate bonds. Municipal arbitrage hedge funds also can be highly leveraged.
Bernstein Liebhard is investigating allegations that the 1861 Capital Discovery Domestic Fund, LP (the “1861 Fund”) was marketed and sold by UBS and other broker dealers as a safe, secure, and low-risk, when, in truth, the fund was a highly leveraged municipal arbitrage fund.
The marketing of the 1861 Fund targeted high net worth, individual investors who were generally risk averse, took a conservative approach to investing and were interested in the safety and security offered by tax free municipal bonds.
However, the strategy employed by the 1861 Fund was risky and exposed investors to a 100 percent or more loss of principal, was more than two times more volatile than the S&P 500, and seven times more volatile than a traditional portfolio of municipal bonds.
If you purchased 1861 Capital Management Municipal Bond Arbitrage Funds from a broker/dealer and you are a high net worth investor (i.e. you have investable assets of over $1 million, not including collectibles and residences) and wish to discuss your rights, including a potential securities arbitration, please contact Jeffrey M. Haber, Esq. at (877) 779-1414 or Haber@bernlieb.com.
Bernstein Liebhard LLP, established in 1993, represents institutional and individual investors in securities arbitration, shareholder, class and derivative litigation and plaintiffs in various types of complex litigation. The Firm has been named to The National Law Journal’s “Plaintiffs’ Hot List” for the past eight consecutive years. For more information concerning the Firm’s Securities Arbitration Practice, please visit the Securities Arbitration Practice Group page.
