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Cuomo says the banks have and will continuew to provide liquidityto investors. Last October, agreed to buy back as much as $4.7 billion in auction-ratse securities it sold to about 5,500o investors, small businesses and smallp charities before the market collapsed inFebruaryh 2008. According to the Securities andExchangee Commission, the settlement also requiree BofA to “use its best efforts” to provide up to $5 billion in liquidity to businessesw and institutional investors with accounts valued at $15 millioj or more, and charities with accounts valuedd at $25 million or more.
The agreemen resolved allegations that securities dealerws made misrepresentations to customers during salesof auction-rate securities about their safety and Auction-rate securities have interest rates that are reset at weeklhy or monthly auctions run by investment firms. The $330 billiom market collapsed last year, when investors became alarmec at the prospects of the ability of corporate borrowers coveriny debt service onthe securities. Many were left with securitieds they could not sell intothe Charlotte, N.C.-based BofA (NYSE:BAC) neither admitted nor deniesd wrongdoing. BofA is the fifth largest bank inthe N.Y., area, with 42 branchess and $1.
3 billion in The SEC also has finalizexd a settlement with BofA over the securities.
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