UBS to pay ClearOne $45 mln to settle auction-rate securities dispute

Wed Jan 16, 2013 2:34pm GMT

The logo of Swiss bank UBS is seen at their offices in New York December 19, 2012. REUTERS/Andrew Burton

The logo of Swiss bank UBS is seen at their offices in New York December 19, 2012.

Credit: Reuters/Andrew Burton

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(Reuters) - ClearOne Inc (CLRO.O), a maker of audio and video conferencing products, said UBS Financial Services Inc UBS.N agreed to pay it $45 million (28.1 million pounds), after an arbitration panel ruled in its favour in an auction-rate securities dispute.

However, ClearOne said it was denied a similar claim against Morgan Stanley (MS.N) that sought $100 million in damages.

Auction-rate securities were sold as highly-liquid short-term instruments similar to money-market funds but with slightly higher returns.

Thousands of investors were left with securities that could not be sold when the $330 billion auction-rate market failed in 2008 after large investment banks that ran these auctions faced liquidity crunch.

Shares of ClearOne closed at $4.43 on the Nasdaq on Tuesday.

(Reporting by Tanya Agrawal in Bangalore)

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