In the aftermath of guilty verdicts Friday against three former UBS AG professionals in a municipal bond bid-rigging case that government prosecutors lauded, two defense attorneys said they would appeal and an industry organization said the verdicts were a warning to muni bond professionals.

“The decision in this case should serve as a signal to all professionals working in municipal finance that fraud and unfair dealing will not be tolerated,” said Lynnette Kelly, executive director of the Municipal Securities Rulemaking Board. “Federal regulators are focused on ensuring a fair municipal market that protects investors and state and local governments. There is no place for fraudulent activities that undermine the integrity of the market.”

Counts had been brought against three defendants: Peter Ghavami, Gary Heinz and Michael Welty. All three had been prominent professionals in the municipal securities division of UBS in the first half of the last decade.

Ghavami was found guilty of two counts of conspiracy to commit wire fraud and one count of substantive wire fraud. Heinz was found guilty of three counts of conspiracy to commit wire fraud and two counts of substantive wire fraud. Welty was found guilty on three counts of conspiracy to commit wire fraud. Heinz was found not guilty on one count of witness tampering and Welty was found not guilty on one count of substantive wire fraud.

“Today’s verdict is important because it confirms that these complex, seemingly uninteresting backroom deals have a real impact on taxpayers, who should benefit from a municipal bond issue and are ultimately responsible for paying it off,” said Richard Weber, chief of criminal investigation for the Internal Revenue Service. “Today’s convictions send a strong message to the municipal bond industry and demonstrates the commitment of the Internal Revenue Service and the Justice Department to rid the industry of corrupt practices.”

No sentencing date has been set, according to Reuters.

The conspiracies and frauds took place from March 2001 to November 2006, the U.S. government’s prosecutors said.

“While acting as providers, Ghavami, Heinz and Welty, with their provider and broker co-conspirators, corrupted the bidding process for more than dozen investment agreements to increase the number and profitability of the agreements awarded to UBS,” according to the Justice Department. “At other times, while acting as brokers, Ghavami, Heinz, Welty and their co-conspirators arranged for UBS to receive kickbacks in exchange for manipulating the bidding process and steering investment agreements to certain providers.”

The three men’s actions cost U.S. municipalities and the U.S. Treasury millions of dollars, the department stated. Among the issuers that the three men harmed were Massachusetts, the New Mexico Educational Assistance Foundation, the Tobacco Settlement Financing Corporation of Rhode Island and RWJ Health Care Corp at Hamilton.

“Corrupt bidding schemes serve to weaken the public’s trust in the municipal bond market and prevent public entities from enjoying the benefits of a true competitive-bidding process,” said Mary Galligan, acting assistant director in charge of New York Federal Bureau of Investigation. “Today’s conviction is further proof of our efforts to weed out these corrupt criminals and ensure justice is served.”

The three found guilty on Friday are part of a larger group found guilty in the Department of Justice’s ongoing municipal bonds investigation. Twenty individuals have been charged and a total of 19 found guilty in the investigation. One, Phillip Murphy, was charged in North Carolina in July and awaits trial.

Five of the six counts in this Ghavami, Heinz and Welty trial had corporate co-conspirators that were not charged in the trial. They were Bank of America Merrill Lynch, JPMorgan, CDR Financial Services, and GE Funding Capital Market Services Inc.

Bank of America came forward to acknowledge the wrongdoing of some of its municipal bond employees to the Department of Justice. It entered an amnesty agreement with the DOJ in 2007. According to the bank, it was the only financial institution to bring its wrongdoing to the attention of the department before the department started an investigation into industry bid-rigging. In December 2010 it reached a roughly $140 million settlement with the department.

Settlements totaling $700 million has been reached with UBS and other banks in connection with the bid-rigging schemes.

“We exited the municipal investment and derivatives business in 2008, and the conduct at issue concerns former employees’ activities from 2001 to 2006,” said UBS head of public relations Karina Byrne. “UBS resolved our own issues concerning this former business with various regulators in May 2011.”

A spokesman for the Department of Justice said the investigation was “ongoing.”

“We respect the jury’s verdict,” said Heinz’s lawyer, Marc Mukasey. “We’ll continue to fight for Gary so that he can finally put behind him these events that are over a decade old.”

Welty’s attorney did not respond to calls or emails.

Charles Stillman, Ghavami’s attorney told Reuters, “We are obviously disappointed with the verdict. We are looking forward to an appeal.”

A spokeswoman for JPMorgan declined to comment.

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