ALBANY — State Attorney General Andrew Cuomo today announced a “multi-billion dollar” securities fraud lawsuit against UBS Securities LLC and UBS Financial Service Inc.

The lawsuit alleges UBS falsely sold and marketed auction rate securities as safe, highly liquid and cash-equivalent securities representations, which Cuomo said were revealed as deceptive when the auction rate securities market came under strain, leaving customers with securities that could not be liquidated.

Latham-based hydrogen fuel cell development company Plug Power filed its own lawsuit in U.S. District Court against UBS Financial Services on May 8, claiming UBS owes them $62.8 million for improperly investing the company’s money in auction rate securities.

Cuomo said the goal of the state’s suit is returning cash to investors who bought UBS’ illiquid securities.

“Making some of the customers 'somewhat whole' is not satisfactory. These were cash equivalents, that’s what they sold. They said to people, 'Put your money in this account, it’s a cash equivalent'. It was not a cash equivalent. They knew it was not a cash equivalent. They knew the auctions were failing,” Cuomo said. “The resolution here is not going to be some customers get back some money.”

According to Cuomo, UBS clients are holding more than $25 billion in illiquid, long-term paper as a result of UBS’ fraudulent misrepresentations and illegal conduct.