Securities News Releases

Thursday, July 30, 2009
Contact: Laura Egerdal, (573) 526-0949
Contact: Ryan Hobart, (573) 526-4734

Carnahan Recovers Over $260 Million for Missouri Investors

Auction rate securities settlements finalized with Merrill Lynch and RBC

– Secretary of State Robin Carnahan announced today her office has recovered over $260 million for Missouri investors as part of two separate auction rate securities settlements. The orders conclude the repurchase of over $263 million in auction rate securities by Merrill Lynch and the repurchase of over $4.75 million by RBC Capital Markets. Both firms gave individuals and small businesses full access to their savings earlier this year.

The Missouri Investor Education and Protection Fund, which is used for educational initiatives across the state, will also receive payments from both firms. Merrill will pay just under $1.4 million to the fund and RBC will pay $22,000.

“I am pleased that Merrill and RBC did the right thing and gave Missouri investors full access to their savings,” Carnahan said. “Investors from across the state called my office once they discovered their money was frozen, many with urgent needs such as medical bills, living expenses or business payments. In these uncertain times, it has been my priority to get these investors their savings returned as quickly as possible.”

Carnahan has focused on helping auction rate securities investors since the $330 billion market collapsed in February 2008. After the auctions stopped, many investors who had been promised safe, “same as cash” investments suddenly discovered they were holding 20- or 30-year bonds.

Carnahan aggressively led settlement negotiations with firms such as Wachovia Securities and Commerce Brokerage Services, both of which have repaid their investors. Carnahan’s office has also reached agreements with national firms such as Bank of America and Citigroup, bringing the total value of auction rate securities returned to Missourians to well over $1.5 billion.

Investors who were sold auction rate securities by Stifel Nicolaus and Wells Fargo, however, are still without access to their money. In March 2009, Carnahan’s office filed a civil enforcement action against Stifel concerning improper sales of these securities. Working with other states, Secretary Carnahan will continue to fight to protect Missouri investors and hold firms accountable in all auction rate securities cases that have not been resolved.

For more information regarding investments and fraud protection, visit the Secretary of State's online Missouri Investor Protection Center at or call the toll free Investor Protection Hotline at 1-800-721-7996.

-- 30 --

return to news >>

Toll-free Investor Protection Hotline
Report complaints or make inquiries