A team of investigators inspected Wachovia Corp.’s securities division Thursday as part of an ongoing investigation into the company’s sales of auction-rate securities. Regulators from more than five states searched the
Wachovia was warned Wednesday about the raid because the company had not “fully complied with the
It looks like the bank will encounter even more setbacks. According to a June 17, Bloomberg.com article, Wachovia is expected to record a loss of at least $2.6 billion for the second quarter.
In May, Wachovia reported it had received inquiries and subpoenas from the SEC and state regulators concerning underwriting and sales of auction rate securities, and that it expected “further review and inquiry.”
Wachovia clients have filed more than 70 formal complaints to the state since February, totaling over $40 million in frozen assets. Hundreds of
Over $218 billion of auction-rate bonds sold by student-loan providers, municipalities and closed-end mutual funds remain frozen since firms quit roles of last minute buyers in February.