(Reuters) - A unit of UBS AG must pay $5.4 million to a former broker in a dispute stemming from the sale of Lehman structured notes to his clients, a securities arbitration panel ruled.
The $5.4 million ruling includes $1 million in punitive damages, according to a ruling late on Friday by a Financial Industry Regulatory Authority arbitration panel.
Arbitrators included punitive damages in their ruling because UBS withheld material information about Lehman's "sinking financial condition" and continued to recommend the sale of the notes, according to the ruling.
A UBS spokesman did not immediately return calls requesting comment.
(Reporting by Suzanne Barlyn, Editing by Franklin Paul)