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Cuomo said the bankss have and will continure to provide liquidityto investors. In October, agrees to buy back as much as $4.7 billion in auction-rate securitiess it sold to about 5,500 investors, smalp businesses and small charities before the market collapsed inFebruary 2008. Accordinfg to the , the settlement also required BofAto “uswe its best efforts” to provide up to $5 billion in liquidity to businesses and institutional investorws with accounts valued at $15 milliojn or more, and charities with account s valued at $25 million or The agreement resolved allegationz that securities dealers made misrepresentatione about the safety and liquidity of auction-rate securitiess to customers during sales.
Auction-rate securities have interesgt rates that are reset at weekly or monthlyg auctions run byinvestment firms. The $330 billion markef collapsed last year, when investors became alarmed at the prospectd of the ability of corporat borrowers covering debt service on the Many were left with securities they could not sell intothe Charlotte, N.C.-based BofA (NYSE: BAC) neither admitted nor denied wrongdoing. The SEC also has finalizesd a settlement with BofA overthe securities.
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