Variable-rate bonds

Capital finance director David Erdman says VRDO fraud lawsuits piqued his interest in Clarity's platform.

Three lawsuits claiming fraud in the variable-rate demand obligation market are headed toward key court rulings in coming weeks.

A planned elimination of variable-rate debt exposure and termination of outstanding swaps lifted the bi-state transportation agency's rating outlook.

What began as trouble in the housing and mortgage markets shook the whole world in 2008, including a municipal bond industry that had to learn to live without bond insurance, auction-rate debt and some big investment banks.

In their pleading, banks said the plaintiff is "precisely the sort of 'busybody' " that is prohibited from making such claims.

The whistleblower responsible for federal investigations and lawsuits accusing banks and broker-dealers of fraud and collusion in the remarketing of variable rate demand obligations will likely be forced to go public because of a recent ruling by Massachusetts’ highest court.

The amount of outstanding variable rate demand bonds rose to $142.4 billion in the second quarter of this year, a gain over $142.2 billion in the first quarter and the end of a decade-long decline, Moody’s Investor Service said in a recent report.

The authority, one of the largest municipal bond issuers, will use the new benchmark to reduce its exposure to Libor, which is slated to sunset.

The disclosure of some variable-rate demand obligation information on EMMA shouldn't be used to dismiss a lawsuit alleging fraud in VRDO remarketing,lawyers for the plaintiff told an Illinois court.

The Securities and Exchange Commission has sent letters to the 12 top banks and broker-dealers that remarket variable rate demand obligations, seeking information and documents on their remarketing and rate resetting practices.