UBS simply cannot buy a break these days. After weathering tens of billions in writedowns and losses and the US government's attempt to crack open its bank account list, the bank now has another problem on its hands. Securities regulators from New Hampshire have filed a civil complaint against the Swiss bank for misleading investors who purchased principal protected notes and subsequently suffered massive losses once the underwriter, Lehman Brothers, went belly up.

"The safety of these products was exaggerated," Jeff Spill, deputy director of securities regulation for enforcement, said in the statement. "UBS presented these notes as simple, safe investments when in fact they are highly volatile and are subject to shifting market conditions."

You can just hear Mary Schapiro sharpening her blade.
UBS Sold Unsuitable Lehman Securities, New Hampshire Alleges [Bloomberg]