The Treasury Department on Tuesday agreed not to punish First Union Corp. for violating bidding rules on government securities.

In a letter to the government, First Union said its Wheat First Securities Inc. unit violated a rule that bars buyers of Treasury securities from accepting orders to sell those instruments until after the government securities auction has ended.

To avoid future violations, the bank said, it had increased training, enhanced internal policies, and strengthened oversight by its compliance department. The bank noted that it never executed those sell orders until after the auction had ended.

First Union acquired Wheat First in January 1998. The violations occurred between January 1995 and May 1998.

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