RBC to buy back $800 million IN ARS

RBC Capital Markets Corp. of New York will buy back up to $800 million in auction rate securities from more than 2,000 investors under a preliminary settlement announced today by the Securities and Exchange Commission and state securities regulators.
OCT 08, 2008
By  Bloomberg
RBC Capital Markets Corp. of New York will buy back up to $800 million in auction rate securities from more than 2,000 investors under a preliminary settlement announced today by the Securities and Exchange Commission and state securities regulators. RBC Capital Markets, part of Royal Bank of Canada of Toronto, is to use its best efforts to provide liquidity to other larger ARS investors under the agreement in principle, the SEC said. No later than Dec. 15, RBC will offer to buy back at par value securities from individual investors with account values up to $10 million, as well as from charities or religious organizations with accounts valued up to $25 million, that bought the securities from RBC before the collapse of the market for the securities in February. The bank is to reimburse fully individual investors who sold their securities at a discount after the market failed, and it will consent to a special public arbitration procedure to resolve other claims by individuals. “The division of enforcement’s settlement in principle with RBC will quickly restore liquidity to those individual, charitable and small business investors who can least afford to have their funds unavailable in the short term,” division director Linda Chatman Thomsen said in a statement. The settlement must still be approved by the commission. It includes charges made in federal court that RBC misrepresented auction rate securities as safe and highly liquid equivalents to cash and money market funds. RBS continued to market the securities as safe even though it was aware of escalating liquidity risks in the weeks and months before the collapse of the ARS market in February, the SEC said. RBC then stopped supporting the auctions.

Latest News

SEC bars ex-broker who sold clients phony private equity fund
SEC bars ex-broker who sold clients phony private equity fund

Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.

The key to attracting and retaining the next generation of advisors? Client-focused training
The key to attracting and retaining the next generation of advisors? Client-focused training

From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.

Chuck Roberts, ex-star at Stifel, barred from the securities industry
Chuck Roberts, ex-star at Stifel, barred from the securities industry

"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.

SEC to weigh ‘innovation exception’ tied to crypto, Atkins says
SEC to weigh ‘innovation exception’ tied to crypto, Atkins says

Chair also praised the passage of stablecoin legislation this week.

Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest
Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest

Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.

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.