JP Morgan Chase and Morgan Stanley joined other Wall Street banks in agreeing to repurchase auction-rate securities. These latest payments bring the total amount of the industry buyback to $48 billion, according to The Financial Times.
The Securities and Exchange Commission has not been involved with the efforts of New York Attorney General Andrew Cuomo and 12 state securities regulators. JP Morgan and Morgan Stanley have agreed to collectively buy back approximately $7 billion worth of auction-rate securities, according to FT. They will pay additional fines totaling $25 million and $35 million.
Cuomo said to FT that the settlements were the “latest victory” for investors. He said, “The industry is taking responsibility for correcting a problem they helped create, and that’s a good thing.”
The latest suit against a financial firm comes from New Hampshire against UBS. The suit claims that UBS, which advised the state’s Higher Education Loan Corporation in the sale of auction-rate securities, told the issues to “increase the interest paid on the bonds to attract buyers to the market, a recommendation which jeopardized the financial well being” of the organization, according to FT.
The SEC said that investigations are ongoing and will include any violations from corporations or individuals. The SEC also stated that the settlements which took place on August 14 would be taken into account.