Wells Fargo appears to be joining Raymond James and Stifel Nicolas in refusing
responsibility for its part in the auction-rate securities fiasco. Although many large underwriters and broker/dealers that sold auction-rate securities have already settled claims, Wells Fargo recently denied allegations of wrongdoing in a lawsuit filed by Washington State regulators. In the lawsuit, regulators seek payment of restitution or damages for customers who purchased some $3.9 billion of auction-rate securities from Wells Fargo. Wells Fargo, the biggest bank on the West Coast, is disputing the allegations, saying that, “the state’s claims and allegations do not accurately portray the facts.”
Wells Fargo and the other two “downstream” brokerage firms did not underwrite many auction-rate securities but aggressively sold large quantities of the securities through their brokers. According to an official at Wells Fargo, “We did not actively market or promote auction-rate securities and we did not provide special incentives for brokers to sell them.”
The Company’s position does not appear sit well with its customers. According to the Seattle Times, one customer, Mr. Guren, an 81 year old resident, said he told his broker the money should to be put in a liquid investment so he could buy a house. The Wells Fargo broker put his money into auction-rate securities. According to Mr. Guren, he had never even heard of auction-rate securities, “I didn’t even know it existed ? how could I have received it had they not promoted it and sold it to me?” Mr. Guren says the majority of his money has now been frozen for eight to ten months and that he is unable to “touch it.”
With the substantial losees incurred by both individual and institutional investors in the auction-rate securities market, those who believe they may have been mislead into purchasing these types of securties should be encouraged to consult attorneys with expertise in the matter to discuss their case and options.
Page Perry is an Atlanta-based law firm with over 125 years collective experience representing investors in securities-related litigation and arbitration. While past results are not indicative of future success, Page Perry’s attorneys have recovered over $1,000,000 for clients on more than 30 occasions, and have aided clients who have been the victims of financial adviser abuse, unsuitable recommendations, and scams. Page Perry’s attorneys are actively involved in counseling institutional and individual investors regarding their investment problems. For further information, please contact us