LexisNexis® Legal Newsroom
The Securities & Exchange Commission’s First Action Against a State

The SEC filed its first action against a state, charging New Jersey with fraud in connection with multiple offerings of municipal bonds dating back to 2001. In the Matter of State of New Jersey , Adm. Proc. File No. 3-14009 (Aug. 18, 2010). The Order for Proceedings alleges fraud in violation...

SEC versus New Jersey

Fuggedaboutit! New Jersey became the first state ever charged by the SEC for violations of the federal securities laws. They gave up without a fight and agreed to settle the case, without admitting or denying the SEC's findings. This matter involves the sale of over $26 billion in municipal...

The First Settlements Imposing a Penalty on City Officials

The SEC settled with four of five former City of San Diego officials in its action centered on fraud in connection with the sale of municipal bonds. SEC v. Uberuaga , Civil Action No. 08 CV 0621 (S.D. Cal. April 7 2008) ( previously discussed here ). The settlements are the first to impose a civil...

UBS Settles Municipal Bond Bid Rigging Charges

UBS Financial Services, Inc. settled a bid rigging action with the SEC related to the investment of municipal bond proceeds. SEC v. UBS Financial services Inc. , Civil Action No. 11-CV-2885 (D.N.J. May 4, 2011). This is the Commission's second recent settlement of a case based on charges stemming...

SEC Charges State of Illinois with Misleading Investors

The SEC charged the State of Illinois with misleading investors when selling about $2.2 billion in municipal bonds over a four year period beginning in 2005. The proceeding alleges violations of Securities Act Sections 17(a)(2) and (3). In the wake of substantial remedial steps initiated by the State...

SEC Charges City and its Underwriter With Fraud

The City of Victorville California, Assistant City Manager Keith Metzler, deal underwriter and broker Newcomb & Dedios or KND and its principle Jeffrey Kinsell were named as defendants by the Commission in a suit alleging fraud in connection with the sale of municipal bonds. The city airport...

SEC Reaches Settlement With City over Federal Securities Law Violations

WASHINGTON, D.C. - (Mealey's) The Securities and Exchange Commission and the City of Harrisburg, Pa., have agreed to a cease-and-desist order preventing the city from continuing its violation of federal securities laws in connection with statements it made both publicly and in financial documents...

City of Harrisburg Settles With SEC on Rule 10b-5 Violations

Recently, the SEC settled with the City of Harrisburg (City) over violations of Rule 10b-5 in connection with material misstatements and omissions made by the City in its public statements and financial information, during a multi-year period. This settlement underscores the increased focus by...

City Charged By SEC with Misrepresentations in Bond Market

The SEC brought another action against a City for inadequate disclosure in connection with a municipal bond offering. In the Matter of the City of South Miami, Florida, Adm. Proc. File No. 3-15329 (May 22, 2013). The action centers on a bond offering initiated in 2002 to finance a public parking...

Local Governments and Securities Litigation Risk

In two administrative enforcement actions last month, the SEC charged two municipalities - Harrisburg, Pa. and South Miami, Fla. - with securities fraud. These high-profile actions sounded alarm bells and raised concerns about possible securities violations involving other state and local governments...

SEC Files Another Fraud Action Tied to the Municipal Bond Market

The SEC filed another settled financial fraud action tied to the municipal bond market which is clearly an area of increasing focus. This proceeding named as a Respondent the operator of the largest public health system in Miami-Dade County Florida. In the Matter of Public Health Trust of Miami-Dade...

For the SEC, a Continued Focus on the Municipal Bond Market

Municipal bond offering cases have become an enforcement priority for the SEC. In recent months the Commission has brought a series of actions against the City of Miami, the West Clark City School District and others. Now the agency has brought two proceedings related to bonds issued by a municipal...

SEC’s First Action Under the Municipalities Continuing Disclosure Cooperation Initiative

The SEC settled its first action under the Municipalities Continuing Disclosure Cooperation Initiative, launched on March 10, 2014. Under the Initiative the Enforcement Division agreed to recommend settlement on favorable, standardized terms for issuers and underwriters who self-report or were already...

SEC Brings Another Bond Case Against a State

The SEC’s nationwide review of municipal bond disclosures yielded another enforcement action, this time against the state of Kansas. The Order centers on claims that the state failed to disclose its huge unfunded pension liabilities. In the Matter of The State of Kansas, Adm. Proc. File No. 3-16009...