KIMBERLY, Wis. (AP) – An investment firm accused of misconduct for selling risky investments to five Wisconsin school districts has agreed to pay them about $30 million.
The Securities and Exchange Commission announced the settlement between RBC Capital Markets and the five districts; including Kimberly, Kenosha, Waukesha, Whitefish Bay, West Allis-West Milwaukee and Milwaukee.
The districts sued two investment firms in 2008 after losing a combined $200 million. The districts thought the money was to be directed to low-risk investments for retired teachers’ benefits, but was instead invested in high risk mortgages. WLUK-TV says RBC has denied any wrongdoing.
The SEC has also charged the brokerage firm Stifel, Nicolaus & Co. with defrauding the district involving the same investments. Stifel blames RBC with misleading it about the suitability of the investments.
Information from: WLUK-TV, http://www.fox11online.com