GE to settle municipal bond rigging lawsuit for $18 million

General Electric Co. acknowledged on Thursday that a cut in its top-tier credit rating was possible, but its chief financial officer said there was no "time bomb" hidden in its hefty finance arm. REUTERS/Brian Snyder·Reuters· (Reuters)
Nate Raymond
0

By Nate Raymond NEW YORK (Reuters) - General Electric Co has agreed to pay as much as $18.25 million to settle a class action lawsuit accusing it of rigging bids for municipal securities, court papers filed on Friday show. The accord requires court approval, and flows from litigation that began in 2008 over claims that banks and finance companies conspired to artificially fix prices for so-called municipal derivatives. The GE settlement involved activity by three of the company's units: GE Funding Capital Market Services, Trinity Funding Co and Trinity Plus Funding Co. A spokesman for General Electric did not immediately respond to a request for comment. The settlement was revealed two days after plaintiffs sought court approval of a separate $20 million settlement with Bank of America Corp over its own alleged big-rigging conduct. The deal also came almost two weeks after a federal appeals court reversed the convictions of three former GE banking executives for conspiring to rig bids for contracts to invest municipal bond proceeds. The 2nd U.S. Circuit Court of Appeals has yet to release its reasoning for overturning the 2012 convictions of the three GE Capital bankers: Dominick Carollo, Steven Goldberg and Peter Grimm. GE's settlement follows an earlier $30 million settlement by the Fairfield, Connecticut-based company to resolve claims by state attorneys general. In 2011, GE also agreed to pay $70 million to resolve a investigation by the U.S. Department of Justice into its role in bid-rigging of municipal bonds. In the lawsuit, investors contended bid-rigging by GE and other firms violated antitrust law and forced them to receive lower interest rates than they otherwise would have. The lead plaintiffs include the City of Baltimore, and the Central Bucks School District and Bucks County Water & Sewer Authority in Pennsylvania. The GE and Bank of America settlements follow earlier deals for $44.6 million by JPMorgan Chase & Co, $37 million by Wells Fargo & Co and $6.5 million by Morgan Stanley, court papers show. As with GE, Bank of America, JPMorgan, Wells Fargo and UBS AG have settled related claims brought by various state attorneys general. The case is In re: Municipal Derivatives Antitrust Litigation, U.S. District Court, Southern District of New York, No. 08-02516. (Reporting by Nate Raymond in New York; Additional reporting by Ernest Scheyder; Editing by Ken Wills)

Advertisement

Recommended Stories

  • Jeff Bezos' Most Prized Possession Breaks Historical Auction Records At Almost $53 Million

    Jeff Bezos amassed his wealth through Amazon stocks and owns hundreds of millions of dollars worth of real estate, but one of his most valuable possessions may surprise you: art. Among his collection is the renowned piece "Hurting the Word Radio #2 (1964)" by Ed Ruscha, purchased by Bezos for almost $53 million. This artwork, a prime example of Ruscha’s text-based paintings, stands as a signature piece in Bezos’ collection. As concerns over stock market volatility persist, the world’s wealthiest

  • Warren Buffett's Latest $2.6 Billion Buy Brings His Total Investment in This Stock to More Than $77 Billion in Under 6 Years

    The Oracle of Omaha has purchased shares of his favorite stock for 23 consecutive quarters.

  • Anthropic now lets kids use its AI tech -- within limits

    AI startup Anthropic is changing its policies to allow minors to use its generative AI systems -- in certain circumstances, at least. Announced in a post on the company's official blog Friday, Anthropic will begin letting teens and preteens use third-party apps (but not its own apps, necessarily) powered by its AI models so long as the developers of those apps implement specific safety features and disclose to users which Anthropic technologies they're leveraging. In a support article, Anthropic lists several safety measures devs creating AI-powered apps for minors should include, like age verification systems, content moderation and filtering and educational resources on "safe and responsible" AI use for minors.

  • Bluesky now lets you personalize main Discover feed using new controls

    Bluesky is now allowing users to personalize their main Discover feeds. The social network is rolling out an updated version of its app that lets users offer feedback about its algorithmic feed so they can better customize it using "Show more like this" and "Show less like this" buttons in a post's menu to choose which content the algorithm surfaces. The change will help Bluesky users create a timeline that takes into consideration their own preferences, not what the company thinks they should see.

  • With Apple entering the fight, the AI chip wars have gone nuclear

    The AI PC chip wars are going nuclear as Apple officially joins the fight with its M4 processor.

  • I Finally Decided to Cut My Losses and Sell This Stock -- Here's Why

    This real estate technology company could be hit hard by a changing real estate market.

  • Palantir Stock (NYSE:PLTR): Should You Buy the Post-Earnings Dip?

    Palantir stock (NYSE:PLTR) dipped by about 16% after its Q1 earnings report, prompting me to ponder whether this downturn presents a buying opportunity. Notably, Palantir showcased yet another quarter of solid revenue growth, promising client base expansion, and strong profitability metrics. That said, concerns persist regarding the stock’s elevated valuation. Consequently, despite my belief in Palantir’s long-term prospects as a shareholder, I maintain a neutral stance towards the stock at pres

  • McDonald’s Will Offer a $5 Meal Deal to Lure Customers Back Into Stores

    (Bloomberg) -- McDonald’s Corp. is looking to launch a $5 meal deal in the US that the burger chain is betting can lure penny-pinching consumers back in.Most Read from BloombergElon Musk Pledges to Grow Supercharger Business He Just DecimatedApple Nears Deal With OpenAI to Put ChatGPT on iPhoneBiden Set to Hit China EVs, Strategic Sectors With TariffsJim Simons, Code Breaker Who Mastered Investing, Dies at 86Ice Cube’s Big3 Basketball League Sells Its First Team in $10 Million DealThe deal could

  • 3 Rock-Solid Dividend Stocks That Are Ideal for Retirees

    These are low-risk stocks with high yields.

  • Bitcoin Is In a 'Bore You to Death' Phase, but Bottom Could Be Close, Analysts Say

    The current boring crypto market could last between one to six months, and the sentiment will be the most negative right before the turnaround, one hedge fund manager said.