Law and legal issues

California Attorney General Jerry Brown said Wednesday the state will sue eight council members and former officials of the city of Bell for the return of hundreds of thousands of dollars of “unwarranted” salaries.

A high-ranking Securities and Exchange Commission ­enforcement official warned Tuesday that issuers risk running afoul of the federal securities laws if they hide materially important information deep within bond-offering documents.

The Municipal Securities Rulemaking Board issued a notice Wednesday making clear that it will not begin registration and rulemaking activities for non-dealer municipal advisers until after Oct. 1, as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The Financial Industry Regulatory Authority has fined UBS Financial Services Inc., Wells Fargo Securities LLC, and two other firms a total of $50,500 for violating municipal trade, pricing and supervisory rules.

New York Democrats chose Sen. Eric Schneiderman on Tuesday as their candidate for attorney general in November.

The top Republican on a House Financial Services Committee panel on Wednesday applauded the decision by the Federal Housing Finance Agency to block PACE energy programs nationwide.

WASHINGTON — Several derivatives market participants attending a federal roundtable here were supportive of a lag in the reporting of large or “block” over-the-counter derivative transactions that can move the market, but they were not sure how much of a delay would be reasonable.

Fearing a national precedent may be set that could affect billions of dollars of municipal debt across the country, the National Federation of Municipal Analysts has filed a brief in Vallejo, Calif.’s bankruptcy case.

WASHINGTON — Market participants are concerned that issuers of draw-down bonds with tax benefits provided by temporary stimulus provisions could lose some benefits if the provisions expire at the end of the year as scheduled.

WASHINGTON — Market participants attending a federal roundtable here Tuesday are expected to raise concerns about price reporting requirements for dealer counterparties to municipal swaps that will be proposed in coming months by the Commodity Futures Trading Commission.

Parking garages serving the new Yankee Stadium in the Bronx are headed for default on $237.6 million of tax-exempt bonds due to low usage in the face of cheaper alternatives, the borrower disclosed last month.

As litigation began Monday against the city of Harrisburg and the Harrisburg Authority, other Pennsylvania municipal governments are facing similar fiscal woes — rising labor costs and sluggish revenue streams.

Assured Guaranty’s chief executive officer said while the outlook for new municipal bond insurers isn’t good, the industry’s alleged problems with existing portfolios are overblown and unsupported by recent data.

WASHINGTON — Douglas Lee Campbell, a former senior vice president and marketer in Bank of America’s municipal derivatives group, pleaded guilty Thursday to three criminal counts for engaging in bid-rigging and fraud conspiracies connected with guaranteed investment contract and other municipal finance agreements.

Harrisburg and Pennsylvania officials are working on securing a potential bank loan so the city can meet a $3.3 million debt-service payment due Sept. 15 and avoid a default.

New Jersey Attorney General Paula T. Dow Thursday announced that JPMorgan will pay the state $1.1 million and buy back auction-rate securities from New Jersey investors to resolve allegations that the bank failed to disclose the risks involved with the ARS market.

WASHINGTON — The Municipal Securities Rulemaking Board has issued draft guidance warning broker’s brokers of their obligations under its rules following recent enforcement actions by the Securities Exchange Commission and the Financial Industry Regulatory Authority alleging rule violations.

DALLAS — Houston’s transportation authority, Metro, faces delays and growing costs on a $1.5 billion light-rail expansion after its purchase of 103 rail cars from a Spanish manufacturer was found to violate federal law.

WASHINGTON — Adrian Scott-Jones, a former agent of a Florida-based guaranteed investment contract broker, pleaded guilty to two separate fraud conspiracies in connection with the brokering of GICs in the municipal market.

A grand-slam judgment last month has emboldened the lawyers and investors seeking to recoup losses on $2 billion in municipal arbitrage funds run by Citigroup.