A former UBS AG official will pay New York $6.5 million to settle allegations that he used insider information to unload auction-rate securities before the market collapsed, state Attorney General Andrew Cuomo announced yesterday. David Aufhauser, formerly general counsel of UBS and general counsel of its investment bank, will forfeit a $6 million bonus to the state and pay a civil penalty of $500,000.

"Senior officials who were operating these firms are to be held accountable," Cuomo said during a conference call with reporters. "If you have situations where senior executives acted improperly, they have to be held accountable, and to the extent there were parachutes or bonus packages received they should be recouped."

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