Mass. Charges Merrill Lynch With ARS Fraud

Law360 (July 31, 2008, 12:00 AM EDT) -- The Massachusetts Securities Division has accused Merrill Lynch of misleading the customers who bought its retail auction rate securities, resulting in thousands of investors being abandoned with illiquid investments.

In an administrative complaint lodged Thursday, Secretary of the Commonwealth of Massachusetts William F. Galvin alleged that Merrill Lynch violated state securities law by marketing auction rate securities as safe, cash-like and liquid investments.

The bank misrepresented the stability of the auction market and co-opted its research department to help sell auction rate securities, according to Galvin....
To view the full article, register now.
Law360 Pro Say Podcast
Check out Law360's new podcast, Pro Say, which offers a weekly recap of both the biggest stories and hidden gems from the world of law.