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SEC charges Rochester, New York, with fraud – Bond Buyer

The Securities and Commerce Fee has charged The metropolis of Rochester, Ny, the Rochester City School District’s former finance director and the metropolis’s former chief monetary officer with deceptive buyers and offering outdated monetary statements in Reference to a $119 munproperlyion bond supplying in 2019.

The Fee additionally charged municipal advisory agency Capital Markets Advisors and its co-principals with breaching their fiduciary obligation to the metropolis and failing To disclose conflicts of curiosity to its municipal consumers.

In grievances filed in federal courtroom in Ny, the SEC claims the supplying paperwork for the metropolis’s August 2019 supplyings of bond anticipation and income anticipation notes have been suppliesly deceptive as they said the district’s spending was inside price range for the fiscal yr when actually the district was experiencing vital monetary misery “As a Outcome of of rampant overspending on teacher salaries,” the SEC said.

“These defendants Did not inform buyers of The acute monetary difficulties the district was experiencing On the time of the supplying,” said LeeAnn Ghazil Gaunt, chief of the SEC’s Public Finance Abuse Unit.

The Rochester City School District and its former finance director Rosiland Brooks-Harris informed buyers that $50 munproperlyion of the proceeds Can be used to “offset The outcomes of timing variations between money receipts and disbursements,” Based mostly on he SEC grievance. The completely different $69 munproperlyion Would supply financing for the district and completely different tasks for The metropolis of Rochester.

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Source: https://www.bondbuyer.com/news/sec-charges-rochester-new-york-with-fraud

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