Battery Park City Authority is suing multiple Wall Street banks for $50 million. Image: Battery Park City Authority is suing multiple Wall Street banks for $50 million. |
Reportedly, the BPCA has accused the defendants of failing to disclose facts about the structure and market of the bonds by placing their own bids in every auction in which they were the designated lead brokers. According to a court filing, the BPCA claims, “the defendants did not disclose their full use of these bids, known as ‘support’ or ‘cover bids,’ thereby making material misrepresentations and/or omissions to plaintiff.” The BPCA is seeking more than $50 million over the issuance of auction-rate securities.
Interestingly, BPCA board member Martha Gallo was the head of global compliance for JP Morgan in 2003, which is one of the banks being sued. Other BPCA board members of note include New York Governor Andrew Cuomo, local real estate developer Carl Mattone, Donald Capoccia, and CFO Robert Serpico. The case is filed as Battery Park City Authority v. Citigroup Global Markets Inc., 650430/2014, and is still in its earliest stages of court proceedings.
For more information, you can access Bloomberg’s coverage of the case.
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