Wednesday, July 22, 2009

SEC Seeks Order Requiring Morgan Keegan To Buy Back ARS

Posted by Plus Master at 9:07 AM
 

The Securities and Exchange Commission is seeking a court order requiring that broker-dealer Morgan Keegan & Co. repurchase illiquid auction-rate securities after allegedly failing to warn its customers about the liquidity risks associated with the ARS market.

The agency said Morgan Keegan , owned by Regions Financial Corp. (RF), sold about $925 millionNovember 2007 but failed to warn them about increased risks even as the firm decided to stop supporting the ARS market in February 2008. of ARS to its customers over a nearly five-month period beginning in

The SEC alleges Morgan Keegan misrepresented to customers the ARS were safe, highly liquid investments that were comparable to money-market funds.

Read the full story here on the Morningstar website.

POSTED IN Errors & Omissions (Non-Medical)

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