Breaking News. CNBC is reporting that Massachusetts is charging Wall Street giant Merrill Lynch with fraud relating to their collateralized debt obligation (CDO) issuances.
More as it develops. And oh yeah, we all saw this coming, didn’t we?
Update 1:
From Market Watch and the coverage on the Massachusetts CDO fraud lawsuit:
Massachusetts state authorities on Friday charged Merrill Lynch and Co Inc Friday with fraud and misrepresentation related to about $14 million worth of subprime securities it sold to the city of Springfield.
The complaint also charges Merrill agents Carl Kipper and Manuel Choy.
“This complaint is focused on Merrill Lynch’s sale, through agents Kipper and Choy, of certain esoteric financial instruments known as collateralized debt obligations (CDOs) to the City of Springfield Massachusetts, which were unsuitable for the city and which, within months after the sale, became illiquid and lost almost all of their market value,” the state said in its complaint.
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