Auction Rate Securities

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Conservative, income oriented investors in Auction Rate Securities (ARS) are now discovering that these "just like cash" investments are not liquid and may have little or no value unless they take legal action.

ARS investors thought they had a money market or CD-like securities that they could cash out when needed. As early as last summer, the $330 billion auction rate market began locking up. As the global credit crunch continued, it has been increasingly hard to resell the securities.

A few companies, like Nuveen and Eaton Vance, are making attempts to cash out holders of ARS, but so far none of the investors have received a dime.

Investors checking their portfolios online may be shocked to see the value of their securities listed as "N/A" (not available), and showing a worth of zero. Others see values of 75 to 95 cents on the dollar.

UBS cut the value of the average ARS by 5 to 15 percent on March 28th. Morgan Stanley was valuing the securities at par as of March statements, but included a notice stating that investors may not realize par value when selling the shares.

The fund issuers are telling investors they should sue the brokers such as E Trade, Ameritrade, UBS, Morgan Stanley, Merrill Lynch, Schwab, Fidelity, etc. who sold them the ARS.

In the mean time, investors are left with securities that are being devalued, or are unsalable. Investors are hiring attorneys in order to get priority status and treatment for their individual losses. Because many institutions issued these bonds, and many brokerage firms sold them, ARS investors should take prompt legal action to protect their savings.

Auction Rate Securities Articles

Investors "Screwed" by Auction-rate Securities
It was as recent as the fall of 2007 when investors were encouraged to place their life savings into auction-rate securities. They were told that such an investment was as safe as cash. However, these investors have now learned that the large institutional investors were selling off their auction-rate securities at the same time the smaller investors were buying in.

State Regulators and Attorney General Probe Banks and Brokers in Auction Rate Securities Debacle
New York State Attorney General Andrew Cuomo has launched a probe into the failure of the auction rate securities market. The industry-wide investigation has slapped subpoenas on 18 banks and securities firms that underwrote and brokered the investments. Under the gun is the marketing of the securities and how the decision was made to stop the bidding on them in mid-February.

Broker Insists Auction-Rate Securities are Still Safe
Natalie handed her life savings over to a UBS Financial Services broker with explicit instructions to invest in certificates of deposit (CD). Instead, they were put into auction-rate securities and despite the collapse of that market, the broker still insists Natalie's investment is not at risk.

Caught with Auction Rate Securities
What Barbara requested from her broker was a safe liquid alternative to her placing large sums in the bank but what she ended up with was auction rate securities that cannot be cashed out.

Lawsuit Pending Against Wells Fargo due to Illiquidity of Securities for Investors
The effects of the fallout in the auction rate securities market is being felt everywhere across the country. A crop of lawsuits is springing up for brokerage firms that dealt in securities that are now in a state of illiquidity for investors. Wells Fargo and Co. and its non-bank subsidiary, Wells Fargo Investments that is based in San Francisco, CA are facing an auction rate securities lawsuit.

To TD Ameritrade: “I Want My Money!”
Class action lawsuits against Ameritrade TD over their auction rate securities are flying everywhere right now because investors are not able to get their money out of their accounts.

Auction-Rate Securities: $333 Billion in Assets Frozen
The latest victim of the credit crisis—Auction Rate Securities—are producing victims of its own: thousands of investors who either assumed, or were told that their investments were as good as cash.

From Half a Million to Uncertain Worth with Auction Rate Securities
On the advice of a respected broker, Lisa invested a sizeable inheritance into auction rate securities, counting on a healthy return when she was ready to cash them out. That day may never come; the $330 billion ARS market is being devalued and the bonds are increasingly hard, if not impossible, to sell.

Auction-rate Securities: What They Are, and Why You Should Call Your Lawyer
An investment product often touted as completely liquid and as good as cash is proving to be anything but in a slowing economy, leaving many desperate investors high and dry, and without access to their funds. Auction-rate securities, it turns out, are in reality not akin to cash and the fine print, it has been reported, duly points that out. However, some investors are claiming never to have received a prospectus at all, while others assert that brokers told them auction-rate securities were AAA products and as good as cash.

Investor files lawsuit against Wells Fargo
A man by the name of Cory Walters filed a lawsuit against Wells Fargo, alleging that it is in violation of the Texas Business Commerce Code and the Federal Securities Act when he received financial direction from them, according to the lawsuit filed in San Antonio federal court. His suit is just one of many where people are filing lawsuits against their financial advisors.

Auction Rate Securities Legal Help

If you have purchased Auction Rate Securities from a brokerage firm or dealer, please click the link below to send your complaint to a lawyer to evaluate your claim at no cost or obligation.