The Colorado Division of Securities has reached a $2.9 million settlement with TD Ameritrade.
Under the agreement, Ameritrade will buy back $2.9 million worth of auction rate securities from retail Colorado investors who found themselves unable to sell their securities after they’d been frozen in the auction rate securities market.
The settlement – the tenth since the market faltered during 2008 – followed an investigation by state securities regulators into allegations that Ameritrade’s agents marketed auction rate securities as liquid and as an alternative to cash and money market funds. The company also allegedly failed to fully disclose the market and the risks associated with securities.
Previous settlements include Deutsche Bank Securities, Citigroup Global Markets, Bank of America Securities, Credit Suisse Securities, JP Morgan Chase, Merrill Lynch, RBC Capital Markets, Wachovia Securities, UBS Securities LLC and UBS Financial Services, Inc.