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also will pay a $35 millio n penalty and JPMorgan will paya $25 million penalty. Underf the agreement, JPMorgan and Morgan Stanlet agree to buy back allliquidc auction-rate securities from retail customers, charities and small- to mid-sized businesses. JPMorgan must buy back the auction-rate securities by Nov. 12. Morgan Stanleu must do so by Dec. 11. By Cuomo's he has secured abouft $30 billion for some 100,000 The attorney general said the agreements settle allegatione that JPMorgan and Morga n Stanley made misrepresentations in their marketing and saleseof auction-rate securities.
Auction-ratwe securities are debt investments issuedby municipalities, student-loan closed-end funds and others, with interesf rates that are reset at weekly or monthly auctione run by the investment firms. The $330 billiobn market collapsed in February when investors becamre alarmed at the prospects of corporatde borrowers covering debt service on the On Monday, Morgan Stanley announced plans to repurchase auction-ratew securities that were purchased prioe to Feb. 13. Cuomo's office issued a statement at the time concerninghMorgan Stanley's plans. "This is too little, too late, and our investigatiob into MorganStanley continues," said Cuomo'sz spokesman, Alex Detrick.
Last week, Cuomo's office securee agreements with and that will return morethan $20 billionn to investors. "Returning billions of dollars back to investors not only protectx their interests but also increase confidence in theentire market," Cuomo "Today's multi-billion dollar agreements are the latesf victories for investors seeking reliefv from the collapse of the auction-rate securitiesa market, which has left a strangleholdd on billions of dollars.
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