UBS AG Case 7/24/2008

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Company Name(s): 
Case Name: 
UBS AG Case 7/24/2008
Case Status: 
Lawsuit Filed
Affected Securities
Lawsuit Overview
Type of Lawsuit: 
Civil Action
Date Filed: 

L.A. City Attorney Rocky Delgadillo has filed two separate lawsuits in the Superior Court of California for the County of Los Angeles against major Wall Street Investment banks, including bank of America, Inc. and UBS AG and several municipal bond insurers accusing them of fraud and antitrust. The city of Los Angeles like other cities, U.S. states and agencies issues municipal bonds to fund various public projects. The lawsuit against the Wall Street firms alleges that the firms colluded to rig the bidding process and price-fixing in the municipal derivatives industry. Rocky Delgadillo said that as a result, Los Angeles did not obtain competitive rates, losing tens of millions of dollars it should have earned. The other lawsuit is filed against more than 30 municipal bond insurers, including Ambac Financial (NYSE:ABK - News), MBIA Inc’s (NYSE:MBI - News) MBIA Insurance Corp and Financial Guaranty Investment Co., and alleges that they charged municipalities fraudulently high premiums. According to the complaint the city was forced to purchase insurance from a triple-A-rated guarantor in order to benefit from that top rating. The lawsuits allege that it could cost taxpayers millions of dollars. The Los Angeles city attorney’s office detailed the complaints in a statement released on Wednesday.