SEC investigating bank over auction-rate securities sales
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The Bank of New York Mellon Corp. disclosed Friday in its quarterly report that the Securities and Exchange Commission is investigating possible breaches of procedure by one of the bank's subsidiaries in auction-rate securities sales and purchases. Auction-rate securities are long-term bonds with varying interest rates that change based on weekly or monthly auctions. In the report, bank officials wrote:
The Company self-disclosed to the SEC that Mellon Financial Markets LLC placed orders on behalf of issuers to purchase their own Auction Rate Securities. The SEC is conducting an investigation of those transactions. MFM is cooperating fully with the SEC in its investigation.
On Thursday, the SEC agreed to a preliminary settlement with financial firm Citigroup Global Markets, Inc. over the firm's auction-rate securities practices, and Friday the agency entered into a similar settlement with the firm UBS. UBS is also facing a lawsuit filed late last month by New York Attorney General Andrew Cuomo for allegedly misrepresenting auction-rate securities as low-risk despite the actual volatility of such investments.
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Chicago Business Fraud Attorney
Business Fraud can take many forms. In the broadest terms, a fraud occurs when someone intentionally deceives others for personal gain. Many times business fraud is harmful and recovery is necessary. Losing your personal or business’s assets can devastate your entire life. Contact Roth Law Groupto receive help on restoring your business to normalcy before you were victimized with fraud. Business fraud cases can involve multiple people and complicated schemes aimed at deceiving the public, auditors, investigators, or others. Whether you are dealing with corporate fraud or commercial fraud, we can step in and fight back to receive compensation that you deserve.
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