The Financial Industry Regulatory Authority fined units of HSBC Holdings PLC and U.S. Bancorp in a settlement of cases related to the sale of auction-rate securities that became illiquid when auctions froze in February 2008.
The companies neither admitted nor denied the charges, but consented to Finra's findings under the settlement.
HSBC was fined $1.5 million and has repurchased more than $562 million of the securities that were held by its customers. As part of the settlement, HSBC agreed to offer to repurchase auction-rate securities from some customers that transferred accounts before the earlier buybacks or chose not to participate. U.S. Bancorp was fined $275,000 and has repurchased $150 million of auction-rate securities from customers.
