- Missouri Investor Protection Center
- Investor Education
- Check Out Your Broker or Adviser
- File a Complaint
- Statutes and Regulations
- Investor Protection & Securities Newsletter
- Contact Us
Securities News Releases
Tuesday, October 20, 2009
Contact: Laura Egerdal, (573) 526-0949
Carnahan Returns $8 Million to NatCity Investors
Company must pay $100,000 to Missouri Investor Education and Protection Fund
Jefferson City, Missouri – Secretary of State Robin Carnahan’s office today reached an $8 million settlement with NatCity Investments, Inc., that closes the investigation into the sale and marketing of auction rate securities by the Ohio-based broker.
NatCity and an affiliate have repurchased all $8 million of auction rate securities holdings that were sold to Missouri clients. Along with repaying its customers, NatCity must pay $100,000 to the Missouri Investor Education and Protection Fund.
“My office continues to do the hard work necessary to help Missourians recover from the auction rate securities debacle,” Carnahan said. “I applaud NatCity for doing the right thing for their clients, and I will continue to seek immediate relief for any investors who still have not been made whole.”
NatCity engaged in sales practices that violate Missouri securities laws and failed to reasonably supervise its agents in Missouri. As part of the settlement, NatCity must now participate in a special arbitration process for investors who suffered a loss or damages because they could not access their money.
Carnahan's office began its investigation into NatCity's auction rate securities activities following a complaint by a St. Louis-area resident in August 2008. This settlement is separate from her work with the national task force of state regulators, which has reached agreements with 11 major financial firms since the $330 billion auction rate securities meltdown in February 2008.
Carnahan's office will continue to work with firms to reach a resolution for those investors that still do not have access to their savings. To this end, Carnahan filed a civil enforcement action against Stifel Nicolaus, Inc., for violations related to auction rate securities. Regulators in Colorado, Indiana and Virginia have also filed similar formal enforcement actions against Stifel.
All securities orders can be found online at www.sos.mo.gov/securities/orders/.
For more information regarding investments and fraud protection, or for information regarding a company or representative, call the Missouri Investor Hotline toll-free at 1-800-721-7996 or visit the Secretary of State's web site at www.sos.mo.gov/securities.
-- 30 --
To find out more about Missouri's Secretary of State's office, visit www.sos.mo.gov