SEC Charges Broker-Dealer With Auction Rate Sales Violations

SEC Release No. 33-9228/34-64767/IA-3227

June 29, 2011

The SEC announced a settled administrative action against a broker-dealer that allegedly made inaccurate statements when selling auction rate securities to customers. In settling the proceeding, the broker-dealer agreed to, among other things, provide its customers the opportunity to sell back to the firm any auction rate securities purchased prior to the collapse of the ARS market in February 2008. The settlement follows in a long list of similar ARS-related actions brought by the SEC and FINRA in recent years.

Cross References

SEC Press Release No. 2011-136

Securities Act Section 17(a)(2)