WASHINGTON — JPMorgan and Wells Fargo will pay municipal bond issuers a total of nearly $78 million to settle a civil class-action lawsuit claiming they manipulated bidding for guaranteed investment contracts.

Settlements approved late last week by Judge Victor Marrero of the U.S. District Court of the Southern District of New York in Manhattan call for JPMorgan to pay $42.6 million and for Wells Fargo to pay $35 million.

The lawsuit was filed in 2008 by a group of municipal bond issuers including the city of Baltimore, the University of Mississippi Medical Center, the University of Southern Mississippi, the University of Mississippi, the Mississippi Department of Transportation, the Central Bucks School District in Doylestown, Pa., and the Bucks County, Pa., Water and Sewer Authority.

The issuers said JPMorgan and its Bear Stearns unit, Wells Fargo’s Wachovia division, and roughly two dozen other firms were involved in holding “sham” auctions in which they manipulated bids for investment agreements for bond issuers.

The GIC providers named in the suit allegedly discussed their bids with each other, submitted artificially-low bids and took turns as bid winners, according to court papers.

The brokers helped rig the bids and were compensated with secret payments, said the plaintiffs.

Marrero called the settlement with JPMorgan “fair, reasonable and adequate.”

“The settlement was attained following an extensive investigation of the facts. It resulted from vigorous arm’s-length negotiations, which were undertaken in good faith by counsel with significant experience litigating antitrust class actions,” Marrero wrote.

JPMorgan has already deposited $24 million in an escrow account and will make an additional payment of $18.6 million, plus interest, according to court papers.

Marrero also approved the Wells Fargo settlement, but court documents said it will not be final before Feb. 15.

An attorney for Wells Fargo requested the extension because federal law requires that the firm file paperwork with the Office of the Comptroller of the Currency at least 90 days before a final ruling. Wachovia filed those papers Nov. 14, court papers said.

That firm has already paid $20 million to a settlement fund and will pay an addition $15.1 million.

Other defendants named in the suit included GIC brokers like Investment Management Advisory Group Inc., CDR Financial Products Inc., and First Southwest Company.

Roughly two dozen GIC providers were also named, including AIG Financial Products Corp., Bank of America N.A., GE Funding Capital Market Services Inc., Genworth Financial Inc., Lehman Brothers Inc., Merrill Lynch & Co. Inc., and UBS AG.

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