Eliot Spitzer has done it again. The outgoing New York Attorney General has sued UBS and thus has raised another one of those thorny industry issues. The suit contends that UBS improperly placed some customers into fee-based accounts, even when they would have been better off in a commissioned account. Had that account come with, as UBS promised, personalized financial advice, then the move could have been better defended. Spitzer said that advice never materialized. The AG holds up the example of an elderly woman who was charged about $35,000 for two trades over two years. That was $33,000 more than if she had been charged on a commission basis. It's unclear whether other firms are vulnerable. UBS says it did nothing improper. Of course, fee-based accounts are better from a profit point of view and the marketing advantage was that they made "churning" less likely.

For more:
- here's a New York Times article