SEC Charges New Jersey|With Securities Fraud

     WASHINGTON (CN) – The SEC today charged the State of New Jersey with securities fraud: misrepresenting and failing to disclose that it underfunded the state’s two largest pension plans in selling $26 billion in municipal bonds.

     The SEC’s cease-and-desist order claimed that offering documents for the securities created the false impression that the Teachers’ Pension and Annuity Fund and the Public Employees’ Retirement System were being adequately funded, hiding the fact that New Jersey was unable to make contributions to the two funds without raising taxes or cutting services.
     New Jersey, the first state the SEC ever charged with securities violations, settled the complaint without admitting it.

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