Report: UBS tie challenges McCain campaign

WASHINGTON, June 7 (UPI) -- A co-chairman of John McCain's presidential campaign is also an executive with a Swiss bank being investigated by regulators, Newsweek reported.

Former U.S. Sen. Phil Gramm, R-Texas, is one of five McCain campaign co-chairs. A sixth, former Rep. Tom Loeffler, R-Texas, resigned from the campaign after Newsweek reported on his role as a lobbyist for Saudi Arabia.

Gramm is vice chairman of a U.S. division of UBS, the financial giant based in Zurich that has recently written off major losses in subprime-mortgage-based securities.

Citing reports last week by liberal bloggers, Newsweek said Gramm was a registered lobbyist for UBS on mortgage-securities issues until at least December 2007.

Congressional and Justice Department investigators are focusing on UBS in a probe of alleged schemes that allowed wealthy Americans to evade income taxes by using overseas havens, Newsweek said, citing U.S. and European law-enforcement and banking officials who requested anonymity.

UBS withdrew Gramm's lobbying registration in April.

"UBS is treating these investigations with the utmost seriousness and has committed substantial resources to cooperate," a UBS spokesman told Newsweek.

A McCain campaign spokeswoman said the campaign would not comment on "ongoing investigations and legal charges not yet proved in court."