Swiss bank UBS has agreed to pay $160 million (SFr137 million) to settle charges that it fixed the bidding process for investment contracts in the United States.This content was published on May 5, 2011 - 08:16
UBS admitted and accepted responsibility for illegal, anti-competitive conduct by former employees from 2001-2006 in contracts for cities and towns in 24 states, the US Justice Department said on Wednesday.
The local governments were looking to invest their proceeds from municipal bond sales - issued to build schools, hospitals and roads – and former UBS employees manipulated the bidding process to win contracts to sell investments.
UBS also acted as a bidding agent for municipalities and rigged bids for the benefit of other financial firms, at times "facilitating" the payment of kickbacks to other bidding agents, who collect proposals for government business, the Justice Department said.
The $160 million is being paid as restitution and penalties to federal agencies and states. Because UBS admitted to the conduct and cooperated, the Justice Department said it agreed not to prosecute the bank.
"UBS is pleased to have resolved this matter with its regulators. The underlying transactions were entered into in a business that no longer exists at UBS and involved employees who are no longer with the firm," the bank said in a statement.
The bank said it had set aside the money and that it would have no effect on financial results.
The case is part of a wider investigation by the government. So far the government has brought criminal charges against 18 former executives of several financial firms, including four former UBS employees. Nine of the 18 have pleaded guilty.
This article was automatically imported from our old content management system. If you see any display errors, please let us know: firstname.lastname@example.org