DES MOINES, Iowa — Wells Fargo & Co. said Tuesday it has agreed to pay at least $37 million in a lawsuit that alleges several banks rigged bidding competitions to win business from state and local governments.
Banks help municipalities invest the money they raise from bond offerings to earn interest before paying for projects. They compete by submitting to state and local governments the best yield they can offer.
The lawsuit alleges several banks rigged the process and deprived governments of a true competitive process that would produce the best returns on their investments.
The lawsuit was consolidated from several states cases into the Southern District of New York in 2008.
It alleges many top investment banks conspired to rig the bidding process, “sharing their illegal gains through kickbacks to one another, and making other secret, undisclosed arrangements.”
Republic Airways looks into split with Frontier
Frontier Airlines could soon be up for sale.
Known to travelers as the airline with pictures of animals on the tails of its planes, Frontier Airlines has lost $102.4 million this year. Smaller planes have been jettisoned and unprofitable flights cut by its owner, Republic Airways, in an attempt to turn Frontier’s finances around.
Republic thinks that Frontier will be profitable next year, not counting interest payments, and says it will bring advisers on board to help find a buyer.
The company had “substantially achieved” the $120 million in cost savings it was seeking for Frontier, Republic Chairman and CEO Bryan Bedford said.
Frontier had 95 planes as of Sept. 30, down from 100 a year ago.
Ex-hedge fund boss fined $92M in trading case
NEW YORK — A judge has cited the “huge and brazen” nature of the crime as he imposed a $92 million civil penalty on a hedge fund boss snared in the biggest insider trading case ever.