Dealers in $128m ARS repurchase as legal actions continue
Three securities firms are to repurchase $128 million in auction-rate securities (ARS) from aggrieved holders of the illiquid instrument and will pay $600,000 in fines in the latest in a spate of regulatory actions in response to the mis-selling of the variable interest rate instruments.
The Financial Industry Regulatory Authority (Finra) announced on September 1 that Milwaukee-based Northwestern Mutual Investment Services will repurchase $103 million in illiquid ARSs from investors and will pay a $200,000 fine to the self-regulating securities supervisor.
Indianapolis-based City Securities Corporation will buy back $13.1 million of ARS contracts and pay a $250,000 fine, while Cincinnati-based Fifth Third Securities will reimburse $11.9 million to investors and has agreed to pay
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