Montgomery County will get $220,000 from bid-rigging settlement

Posted: April 04, 2013

Montgomery County will get more than $200,000 as part of a bid-rigging settlement from a nationwide investigation of banks and other financial-service firms.

Pennsylvania Attorney General Kathleen G. Kane said recently that settlements over the last year with Union Bank of Switzerland, JPMorgan Chase, Wachovia, Bank of America, and GE Funding Capital Market Services would send more than $1.9 million to the scheme's Pennsylvania victims.

Montgomery County's share is $220,047, the second-largest in the state. The Pennsylvania Housing Finance Agency will get $749,327. Others getting money include the Children's Hospital of Philadelphia, Swarthmore College, and the Pennsylvania Turnpike Commission.

Kane said the settlement stems from a scheme to rig the sale of municipal derivatives, which government units and nonprofits use as a vehicle for investing the proceeds of municipal bonds that won't be spent right away.

Multiple state attorney general's offices and federal agencies are participating in the ongoing investigation. So far, they have alleged that "banks, brokers, and financial service firms manipulated the bidding process and shared information," Kane said.

The result was that victims paid higher fees and got lower interest rates.

County Commissioner Josh Shapiro said he was grateful Kane pursued a settlement. "Because of past bid-rigging, our county paid more for services than we should have, and our taxpayers were harmed."


Contact Carolyn Davis

at 610-313-8109, cdavis@phillynews.com, or @carolyntweets on Twitter.

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