Bankruptcy

WASHINGTON - New York Attorney General Andrew Cuomo yesterday expanded his investigation of auction-rate securities to include JPMorgan Chase & Co., Morgan Stanley, and Wachovia Securities LLC, asking the firms to negotiate agreements to provide relief for investors, as Citigroup Global Markets Inc. and UBS AG did last week.

WASHINGTON - UBS AG, the second-largest auction-rate securities dealer, agreed to purchase or provide liquidity for $22.1 billion of ARS and pay $150 million in fines, in a settlement with state and federal regulators.

The Securities Industry and Financial Markets Association is challenging a key claim of the Securities and Exchange Commission's suit against three Alabama individuals by arguing that the SEC does not have oversight of interest rate swaps based on its municipal swap index, claiming it is an index of interest rates, not securities.

The Securities and Exchange Commission has begun administrative proceedings against Kent Nelson, a former San Diego-based investment adviser who pleaded guilty last year to a federal charge of mail fraud in connection with kickbacks he sent to two New Mexico state treasurers.

BRADENTON, Fla. - After Jefferson County commissioners on Tuesday approved a restructuring plan for its troubled $3.2 billion of sewer debt, Alabama Gov. Bob Riley said he would not call a special session of the Legislature unless the plan has solid backing from lawmakers first.

BRADENTON, Fla.- The Jefferson County Commission yesterday approved a resolution asking Alabama Gov. Bob Riley to call a special session of the Legislature to consider the county's sewer debt restructuring plan.

Citi disclosed Friday in a 10-Q quarterly filing with the Securities and Exchange Commission that it has received subpoenas or requests for information from several self-regulatory agencies and federal authorities, including the SEC and state regulators in Texas, New York, and Massachusetts, which are all investigating the bank's auction-rate securities sales practices.

BRADENTON, Fla. - Jefferson County, Ala., commissioners Friday met in a special session and approved their fourth extension to debt forbearance agreements with liquidity providers, bond insurers, and swap counterparties.

WASHINGTON - Troy Paredes, a securities law professor at Washington University in St. Louis, was sworn in Friday as a member of the Securities and Exchange Commission.

San Diego city attorney Michael Aguirre said he may join Los Angeles and Stockton in lawsuits against municipal bond insurers.

WASHINGTON - Merrill Lynch & Co. sales and trading managers altered their research department's reports on the auction-rate securities market to minimize the risks of the securities and to forestall a collapse of the $330 billion ARS market, Massachusetts Secretary of the Commonwealth William Galvin argued in a lawsuit filed against the firm yesterday.

Federal bankruptcy Judge Michael McManus last week last week ruled that Vallejo employee unions cannot represent retirees in the city’s Chapter 9 bankruptcy case.

BIRMINGHAM, Ala. - Jefferson County as of yesterday afternoon was still seeking a new forbearance agreement with creditors as it continued to struggle to put together a sewer debt restructuring plan acceptable to all parties.

WASHINGTON - Fitch Ratings yesterday proposed changes in its municipal ratings framework that would result in one- to two-notch upgrades on most general obligation bonds and debt backed by broad-based taxes, following a four-month review of the sector.

BIRMINGHAM, Ala. - Jefferson County yesterday was scrambling to get the governor's office to schedule a special session of the Alabama Legislature before Aug. 8 to consider a restructuring plan for the county's troubled sewer debt as it also worked to finalize yet another forbearance agreement with creditors.

CHICAGO - Michigan Gov. Jennifer Granholm this week announced an accelerated schedule for holding a possible hearing on whether to remove embattled Detroit Mayor Kwame Kilpatrick from office.

BIRMINGHAM, Ala. - While Jefferson County continues to negotiate another extension to its forbearance agreements with creditors, the county is planning to hold its first public hearing Aug. 8 on how to deal with the $3.2 billion sewer debt crisis.

SAN FRANCISCO - Orrick, Herrington & Sutcliffe LLP, California's biggest bond counsel firm, has agreed to pay San Diego $2.875 million to settle a lawsuit that accused the firm of negligence for failing to discover the city's pension scandal earlier.

BIRMINGHAM, Ala. - Jefferson County, Ala., negotiators resumed talks with Wall Street creditors yesterday, County Commission President Bettye Fine Collins said in a press conference here.

BRADENTON, Fla. - Several Jefferson County, Ala., officials on Friday said they are continuing to negotiate a resolution to the county's sewer debt crisis that doesn't resort to bankruptcy.