Bankruptcy

DALLAS — Boycotts in the wake of Arizona’s tough new immigration law could add pressure to the state’s slumping economy and further weaken revenue streams for sports and tourism bonds, industry experts said.

Four major municipal market groups yesterday urged the Treasury Department to immediately issue interim guidance on how to determine issue price for Build America Bonds, warning that confusion surrounding the topic is having a “chilling effect” on the still-developing market.

The Investment Company Institute is urging the Municipal Securities Rulemaking Board to expand the proposed second phase of its transparency system for short-term debt to include more types of data and documents, while the Securities Industry and Financial Markets Association is concerned that the expansion would be unduly onerous for dealers.

BRADENTON, Fla. — The nonprofit Raymond F. Kravis Center for the Performing Arts Inc. in Palm Beach County, Fla., has paid $320,000 to the Internal Revenue Service to settle a violation of the Internal Revenue Code’s 5% limit on private use in a bond-financed facility.

WASHINGTON — The Financial Industry Regulatory Authority announced yesterday that it has fined HSBC Securities Inc. $1.5 million and U.S. Bancorp Investments Inc. $275,000 to settle sales-practice violations for municipal and other auction-rate securities the firms sold to retail customers.

WASHINGTON — When President Obama last spoke at New York’s Cooper Union as a presidential candidate two years ago, he called for an overhaul of the “balkanized” regulatory system for the financial markets and blamed the credit crisis on Washington lobbyists and politicians who engineered deregulation in the late 1990s.

WASHINGTON — The Senate Agriculture Committee’s passage yesterday of a bill to regulate over-the-counter derivatives and impose a fiduciary duty on swap dealers for muni issuers drew polarized reactions yesterday. Dealer representatives warned that it would kill the muni derivatives market while a former regulator applauded the provision and called for lawmakers to go even further.

WASHINGTON — The Justice Department is seeking to intervene and temporarily halt fact-finding by a group of localities in their class action suit against Wells Fargo & Co. and 15 other banks, broker-dealers and investment brokers for allegedly conspiring to rig bids and fix prices of investment and derivatives contracts in the municipal market.

The Municipal Securities Rulemaking Board is seeking public comment on draft interpretive guidance it released yesterday that outlines steps dealers must take to ensure the prices they charge customers to buy and sell municipal securities are fair and reasonable.

BRADENTON, Fla. — The Securities and Exchange Commission has opened an investigation into an $83.3 million bond deal that Miami-Dade County sold last year on behalf of the county’s financially ailing Public Health Trust.

Alabama Gov. Bob Riley Tuesday signed a bill placing strict requirements on Jefferson County’s issuance of debt and use of swaps. He said the law would “usher in a new era of transparency and accountability for Jefferson County.”

The Jefferson County Commission Tuesday voted to submit a petition to the U.S. attorney general’s office in Alabama seeking the “criminal forfeiture” of $1.61 million to the county in connection with the federal corruption case of former county commissioner Larry Langford, lobbyist Al LaPierre and Montgomery bond dealer Bill Blount.

WASHINGTON — Senate Agriculture Committee chairman Blanche Lincoln and other Democrats contend it’s necessary to impose a fiduciary duty on dealers that act as swap ­counterparties to state and local governments because some of them have misled municipalities into entering swaps they didn’t understand.

WASHINGTON — Rep. Anna Eshoo will soon introduce legislation requiring the Treasury Department to use some of the profits it obtains from the sale of troubled assets under the TARP program to provide relief to local governments that lost money from the September 2008 Lehman Brothers collapse.

Michigan would see a relatively minor impact on its fiscal position as a result of the new federal health care law, according to an analysis by the Legislature’s Senate Fiscal Agency.

The Obama administration and Senate Democrats yesterday urged senators to come to an agreement on broad financial regulatory reform this week, while the most moderate Republican on the issue argued that negotiations should go on for at least another three or four weeks before a bill is considered on the Senate floor.

WASHINGTON — Swap dealers that pitch to, advise, or enter into swap agreements with states, localities, and public pension funds would have a “fiduciary duty” to put the interests of those entities first, under legislation released Friday afternoon by Senate Agriculture Committee chairman Blanche Lincoln.

WASHINGTON — The Securities and Exchange Commission and the New York attorney general reached settlement agreements with investment adviser Quadrangle Group LLC and others for allegedly engaging in pay-to-play practices with state officials and their consultants to obtain investment business from New York’s pension fund.

WASHINGTON — The Financial Industry Regulatory Authority has fined three firms a total of $62,500 for municipal and other rule violations, including $32,500 from Lexington Investment Co. for failing to accurately report muni and corporate securities transactions.

WASHINGTON — Sen. Charles Schumer joined current and former chairmen of the Securities and Exchange Commission yesterday to urge lawmakers to keep a self-funding provision for the SEC in financial regulatory reform legislation that is inching its way to a vote in the Senate.