In the latest development arising from recent concerns regarding auction rate securities, the New York Attorney General has reportedly launched a wide-ranging criminal investigation by serving subpoenas on 18 firms, including UBS AG, Citigroup, Inc., Merrill Lynch & Co., J.P. Morgan Chase & Co. and Goldman Sachs Group, Inc. Although the subpoenas have not yet been made public, reports cite anonymous sources as stating that the subpoenas are “wide-ranging” and seek documents concerning how auctions were handled, how debt was sold and the nature of representations made and warnings given to investors. The NYAG’s investigation comes on the heels of an investigation into auction rate securities launched recently by the North American Securities Administrators Association. Although documents related to that investigation are also not publicly available, reports indicate that the investigation focuses on the same issues as those identified in the NYAG investigation.
For more information on recent concerns regarding auction rate securities generally, please click here. For more information on litigation arising from recent concerns regarding auction rate securities, please click here.
We will continue to monitor developments related to the subprime mortgage/credit crisis and provide updates at InsureReinsure.com.
