Arkansas Fund Cuts Off UBS Relationship

May 26, 2009 ( - Officials at the Arkansas Public Employees Retirement System have decided to sever their ties with an investment manager at UBS AG over the U.S. Justice Department's probe of the Swiss banking giant.

According to an Associated Press news report, trustees voted five to three to approve severing the contract with UBS, which now manages about $160 million in stock market investments for the system.

Officials say the state’s teacher retirement system, a separate entity, has about $532 million invested with UBS.

The Internal Revenue Service has sued UBS to try and force the bank to turn over information about 52,000 account holders the agency says have an estimated $14.8 billion in assets and are using Swiss bank secrecy to shield the money.

UBS asked that a Miami federal judge deny the IRS petition, according to the report.