SEC Whacks Bond Underwriter for $600,000

     WASHINGTON (CN) – A municipal bond underwriter for an Indiana school district will pay more than $600,000 to settle allegations of making false statements to investors, the SEC said Monday.
     The SEC filed separate cease and desist orders against West Clark Community Schools, in one case, and against City Securities Corp. and the head of its municipal bond division Randy G. Ruhl in the other.
     The defendants were charged with falsely telling bond investors that the school district had properly provided annual financial information and notices in its previous bond offerings.
     “This is the first time the SEC has charged a municipal issuer with falsely claiming in a bond offering’s official statement that it was fully compliant with the annual disclosure obligations it agreed to in prior offerings, and an underwriter and its principal for not doing the necessary research to attest to the truthfulness of that claim,” SEC co-director of enforcement Andrew Ceresney said in a statement
     City Securities will pay $579,446 to settle the charges, the SEC said.
     Ruhl will pay disgorgement, interest and penalties totaling $38,475.
     It’s not clear from the cease and desist order or the SEC statement what penalties, if any, the school district will pay.
     None of the defendants had to admit wrongdoing, as is typical with the SEC.

%d bloggers like this: