Securities and Exchange Commission

Litigation Release No. 18112 / April 28, 2003

   Securities and Exchange Commission v. UBS Warburg LLC, 03 CV 2943
   (WHP) (S.D.N.Y.)

   SEC SUES UBS WARBURG FOR RESEARCH ANALYST CONFLICTS OF INTEREST FIRM
   TO SETTLE WITH SEC, NASD, NYSE, NY ATTORNEY GENERAL, AND STATE
   REGULATORS

   The Securities and Exchange Commission announced today that it has
   settled charges against UBS Warburg LLC, a Connecticut-based brokerage
   firm and investment bank, arising from an investigation of research
   analyst conflicts of interest. This settlement, and settlements with
   nine other brokerage firms, are part of the global settlement the
   firms have reached with the Commission, NASD, Inc., the New York Stock
   Exchange, Inc. ("NYSE"), the New York Attorney General, and other
   state regulators. As part of the settlement, UBS Warburg has agreed to
   pay $25 million as disgorgement and an additional $25 million in
   penalties. One-half of the total of these payments - $25 million -
   will be paid in connection with the SEC action and related proceedings
   by the NASD and NYSE and will be placed into a distribution fund for
   the benefit of customers of the firm. The remainder will be paid to
   resolve related proceedings by state regulators. In the SEC action,
   UBS Warburg has agreed to a federal court order that will enjoin the
   firm from future violations of the federal securities laws and NASD
   and NYSE rules and require the firm to make changes in the operations
   of its equity research and investment banking departments. In
   addition, UBS Warburg will pay, over five years, $25 million to
   provide the firm's clients with independent research, and $5 million
   to be used for investor education.

   In connection with this matter, the Commission today filed a Complaint
   against UBS Warburg in the U.S. District Court for the Southern
   District of New York, alleging violations of the federal securities
   laws and NASD and NYSE rules. According to the Commission's Complaint,
   from at least July 1999 through June 2001, research analysts at the
   Firm were subject to inappropriate influence by investment banking at
   the Firm. The Complaint also alleges that UBS Warburg published
   exaggerated or unwarranted research or research that lacked a
   reasonable basis, received payments from other firms to publish
   research on certain companies without ensuring that such payments were
   disclosed, and made payments to other firms for those firms to publish
   research on UBS Warburg's underwriting clients. The Firm also failed
   to maintain appropriate supervision over its research and investment
   banking operations.