ARS settlements reached with Citi and UBS

The SEC finalized settlements today with Citigroup and UBS that will provide nearly $30 billion to tens of thousands of customers who invested in auction rate securities before the market for these investment products dried up in February.
DEC 11, 2008
By  Bloomberg
The Securities and Exchange Commission finalized settlements today with Citigroup Inc. and UBS AG that will provide nearly $30 billion to tens of thousands of customers who invested in auction rate securities before the market for these investment products dried up in February. The announced settlement, which is still subject to court approval, calls for New York-based Citigroup to repurchase roughly $7 billion in ARS from its investor clients and for Zurich, Switzerland-based UBS to buy back $22.7 billion from its customers. In early August, the SEC’s Division of Enforcement announced preliminary settlements with Citigroup and UBS that addressed charges that the firms misled investors in regard to the liquidity risks of ARS, which they underwrote, marketed and sold as safe, highly liquid securities, when they in fact were deteriorating. According to the SEC complaint, in mid-February, Citigroup and UBS decided to stop supporting the ARS market, which left tens of thousands of their customers holding billions in illiquid ARS. The SEC also announced today it is hoping to finalize in the coming months agreements in principle on ARS it has previously reached with Bank of America Corp. and Wachovia Corp. of Charlotte, N.C., and RBC Capital Markets Corp. and Merrill Lynch & Co. Inc. of New York.

Latest News

SEC charges Chicago-based investment adviser with overbilling clients more than $2.5M in fees
SEC charges Chicago-based investment adviser with overbilling clients more than $2.5M in fees

Eliseo Prisno, a former Merrill advisor, allegedly collected unapproved fees from Filipino clients by secretly accessing their accounts at two separate brokerages.

Apella Wealth comes to Washington with Independence Wealth Advisors
Apella Wealth comes to Washington with Independence Wealth Advisors

The Harford, Connecticut-based RIA is expanding into a new market in the mid-Atlantic region while crossing another billion-dollar milestone.

Citi's Sieg sees rich clients pivoting from US to UK
Citi's Sieg sees rich clients pivoting from US to UK

The Wall Street giant's global wealth head says affluent clients are shifting away from America amid growing fallout from President Donald Trump's hardline politics.

US employment report reactions: Overall better than expected, but concerns with underlying data
US employment report reactions: Overall better than expected, but concerns with underlying data

Chief economists, advisors, and chief investment officers share their reactions to the June US employment report.

Creative Planning's Peter Mallouk slams 'offensive' congressional stock trading
Creative Planning's Peter Mallouk slams 'offensive' congressional stock trading

"This shouldn’t be hard to ban, but neither party will do it. So offensive to the people they serve," RIA titan Peter Mallouk said in a post that referenced Nancy Pelosi's reported stock gains.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.