SEC Seeks Customer Names in Auction-Rate Bond Inquiry

NEW YORK -- The Securities and Exchange Commission asked brokerages to hand over more details about auction-rate bond sales, as regulators examine whether firms improperly steered clients into securities they can't sell, Bloomberg News reported Friday.

The SEC's inspections office sent letters to the biggest sellers of auction-rate securities this month seeking the names of customers who purchased the notes and the identities of brokers who sold them. Inspectors want lists of bonds that clients bought, showing their values on different dates, a copy of a letter obtained by Bloomberg News shows.

The move comes as regulators expand investigations into the collapse of the $330 billion market for the notes. New York Attorney General Andrew Cuomo has subpoenaed 18 banks and securities firms, including UBS AG and Merrill Lynch & Co., in a probe that may result in criminal charges, a person familiar with the effort said Thursday.

-- NYSSCPA.org News Staff

Posted on 4/18/08