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SMUD Sues Financial Terrorists - Bank of America, UBS, and JPMorgan Over Derivatives

Good for SMUD!

These thieves have been getting away with stealing from unwitting municipalities for years. As a refresher click here to read how JPMorgan Chase and Morgan Stanley deceived city leaders and school boards in Pennsylvania since at least 2003. And the luxury jets JPMorgan Chase bought after receiving $25 Billion in TARP funds And this warning of the coming recession from two years ago

Bank of America, UBS, JPMorgan Sued Over Derivatives

By Joel Rosenblatt

    Nov. 17 (Bloomberg) -- Bank of America Corp., UBS AG and JPMorgan Chase & Co. were sued by a California public utility over claims they rigged sales of municipal derivatives and shared illegal profits through kickbacks.

    The lawsuit, filed by the Sacramento Municipal Utility District, is based on federal and state antitrust claims. It alleges Charlotte, North Carolina-based Bank of America and more than a dozen other banks conspired to pre-select winners of municipal derivative auctions, coordinated their pricing, and accepted kickbacks disguised as fees from co-conspirators.

    The allegations resemble those made by a U.S. grand jury in New York last month, according to the lawsuit filed Nov. 12 in federal court in Sacramento. CDR Financial Products Inc. founder David Rubin and two employees of the Beverly Hills, California- based company were indicted for allegedly accepting kickbacks on investments sold to local governments. CDR is also named as a defendant in the Sacramento case.

    The banks engaged in “allocating customers and markets for municipal derivatives, rigging the bidding process by which municipal bond issuers acquire municipal derivatives, and conspiring to manipulate the terms that issuers received,” according to the lawsuit.

    The charges against Rubin and the CDR employees were the first to result from a more than three-year investigation into bid-rigging in the municipal bond market. The probe is continuing and has already drawn in some two dozen banks, insurers and local government advisers.

    Derivatives are unregulated financial instruments linked to stocks, bonds, loans, currencies and commodities, or linked to specific events such as changes in interest rates or weather.