Indiana’s Securities Division last week reached an agreement on the last of several lawsuits it filed against investment banks in connection with failed auction-rate securities.
Secretary of State Todd Rokita said 12 investment firms, including Goldman, Sachs & Co., agreed to repurchase more than $370 million of ARS held by Indiana investors. The firms will also pay fines that together total $3.5 million.
Indiana accused Goldman and 11 other banks of misleading investors about ARS risks. The other firms are: Bank of America Merrill Lynch, Citigroup, Credit Suisse Group AG, Deutsche Bank Group, JPMorgan Chase & Co., Morgan Stanley, RBC, Stifel Nicolaus & Co., UBS, and Wachovia NA.
“We are holding these companies accountable for the unethical behavior of selling auction-rate securities to Indiana investors without fully disclosing the risks involved,” Rokita said in a statement. “This action sends a strong message that states will not tolerate such unethical and unlawful activity.”
