(Bloomberg) -- UBS will pay $19.5 million in a settlement with the SEC over claims the bank misled individual investors about the risks tied to debt securities packaged with derivatives, officials said.

The Swiss bank misrepresented a proprietary currency index tied to the so-called structured notes, according to the agency this week. UBS misled investors that the investment was "transparent" and that it used "market prices" to calculate the financial instruments underlying the index while undisclosed hedging trades by UBS actually reduced the index by about 5%, according to the SEC. That led to investor losses of about $5.5 million.

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