Subscribe: RSS Feed | Twitter | Facebook | Email
Home | Contact Us

Has Oppenheimer Already Violated Its Auction-Rate Settlement with NY AG Cuomo?

Posted by Larry Doyle on March 29, 2010 1:08 PM |

Is the great lie and fraud encompassing the auction-rate securities fiasco continuing even into the settlement process? Information, or the lack thereof, indicates it is. In the process, the injustice served cold to the thousands of ARS investors, especially those who purchased these so-called ‘cash’ instruments from Oppenheimer Holdings, continues.

Wall Street, Washington, and the bulk of the financial media (exceptions being author Phil Trupp, Bloomberg’s Susan Antilla, and the Washington Examiner’s Marta Mossburg) would prefer to keep the ARS fraud and fiasco neatly under the rug. I have no interest in allowing the fraudulent ARS perpetrators and their financial regulators any degree of comfort in this mess.

To wit, how is it that a so-called ARS settlement executed by New York AG Andrew Cuomo with Oppenheimer Holdings could already be violated? Let’s navigate.

Make no mistake, at point of sale the distributors of auction-rate securities were truly bending their investors over. Not that getting screwed in the back is all that pleasant, but now to be lied to their faces, the Oppenheimer ARS investors continue to be whipped. How so?

Thank you to a loyal Sense on Cents reader, who just so happens to be an Oppenheimer ARS client, for sharing the following message he sent to the New York State Attorney General’s office:

Sent: Sat, Mar 27, 2010 10:59 am
Subject: Openheimer ARS Settlement

I am a NYS resident and I am writing about the auction rate securities settlement you made on behalf of Oppenheimer & Co. I have been searching their web site for over a month now and fail to find any reference to the auction rate securities settlement. There is no telephone line or internet link. I included paragraph #25 from the settlement they made with you at the bottom of this page. Please let me know if I am reading this wrong. It says after 2 days, which would be 2/25/10, these services would be available to clients who’s money your settlement allowed Oppenheimer to hold, indefinitely. Is there another agreement between Cuomo and Lowenthal that supercedes this agreement? Has this agreement changed since 2/23/10? Is there anybody in your office in charge of verifying that Oppenheimer adheres to the terms of their agreement?

25. No later than two (2) business days after the date of this Assurance, Oppenheimer shall establish: (a) a dedicated toll-free telephone assistance line, with appropriate staffing, to provide information and to respond to questions concerning the terms of this Assurance; and (b) a public Internet page on its corporate Web site(s), with a prominent link to that page appearing on Oppenheimer’s relevant homepage(s), to provide information concerning the terms of this Assurance and, via an e-mail address or other reasonable means, to respond to questions concerning the terms of this Assurance. Oppenheimer shall maintain the telephone assistance line and Internet page through at least the last day of the Purchase Deadline, or any extension thereof.

Where is the accountability? Where is the transparency?

AG Cuomo needs to serve the ARS investors’ interests completely and not allow a settlement to serve as much as a facade as anything else. People do look at this stuff, and some other people are happy to write about it. On that note, come on, AG Cuomo! Keep Oppenheimer’s feet to the fire!

America is supposed to be better than this.


UPDATE as of 1:40pm

Wow. This is truly unbelievable!! Guess what just went up at the Oppenheimer site? Auction Rate Securities-National Settlement Offer

Maybe AG Cuomo is reading Sense on Cents? Or perhaps more likely his office read the investor’s letter. In any event, this posting is good for the Oppenheimer ARS investors. I strongly encourage them and the AG’s office to keep the pressure on Oppenheimer so investor funds can be returned in as timely a fashion as possible.

Now if AG Cuomo is reading this site, perhaps we can get him to investigate FINRA’s dumping of $647 million ARS in mid-2007.

Andrew, can you get back to us on that this afternoon as well? EVERYBODY, and I mean EVERYBODY wants to know what happened there. Did FINRA possess material non-public information when they dumped their ARS bonds. I will share with you, Mr. Cuomo, that people inside the industry have informed me they believe FINRA did just that. What say you?

Never give up!!


  • Kathy

    Well done, Larry. Now I would like to know whether Oppenheimer will be penalized a) for not meeting the requirements of the settlement, since they posted this seriously late, and b) for making the NY regulators look bad, since they have failed to compel Oppenheimer to settle in a meaningful way.

  • ARS Investor

    I loved your challenge to Cuomo to investigate finra for insider trading. Since he gave Lowenthal a get out of jail free card for this the odds of him going after finra are nill.

  • wallstvet

    Talk about adding insult to injury. If you check the FINRA updates for all three individuals named in the Massachusetts complaint filed in November 2008–all three got a pass. So the individuals managed to get out of part or all of their personal and family holdings while their victims, especially the larger accounts, are still tied up!
    No comments on this in any of the MSM.

  • Concerned NY Investor

    I am a New York resident and am writing in regards to the settlement agreement between the NY AG’s office and Oppenheimer & Company regarding their fraudulent marketing of Auction Rate Securities. In the settlement, it is made clear that Oppenheimer is to devote whatever resources they have available to buying back ARS from their clients. I have received nothing back as of yet, and just saw today that they are announcing yet ANOTHER big hire and expansion of their brokerage operations:

    David Fields Joins Oppenheimer as Executive Director – Investments and Manager of Newport Beach Office in Southern California

    This is the second one in the past week or so. How is it that they are allowed to pay a dividend, buy back stock, and hire all these new executives to “…continue to expand the Newport Beach and Indian Wells offices while seeking to extend our presence into San Diego County.”

    Are they even being watched by your offices? Will they be made to make their clients whole, like EVERY OTHER SETTLEMENT reached by a state’s Attorney General? Or will they continue to get away with pleading poverty while simultaneously spending money on non-essentials in order to state that they have no excess funds available to help their clients?

  • phil trupp

    That Bub Lowenthal got a pass says it all, sadly. Our new (or is it old?) ethical standard in the financial services industry seems to be, “Leave No Plutocrat Behind!”

  • wallstvet


    As a followup, the week before, Cuomo hit Dsvid Shulman of UBS with a massive fine and suspension for doing exactly what the three guys in the Maasachusetts complaint were accused of doing. Why did Shulman get the book thrown at him and not the OpCo guys? If I were Mr. Shulman I’d be filing an appeal right now. I hope his lawyer reads this blog.

  • ARPS investor

    It’s been 2 years and 3+ mos. + that I have been locked into close to $400k in ARPS. They indicated that these securities were perfectly safe investments where I could reclaim my principle at any time on 7 days notice. I am incredulous that this fraud has been allowed to continue without either the funds and/or the brokerages making amends to their clients. It is absolutely frightening as I cannot afford to lose that kind of money especially as I enter my retirement years.

    Has anyone received any redemptions from E*TRADE?

    • john w

      redemptions from E*Trade, you are joking!? E*Trade has redeemed nil.

      “we” need to be holding their feet to the fire.

      First, they are the bottom tier of the pond scum brokers, and one of the most intransigent and ruthless in their treatment of their so-called customers that they solicited this crap to in the fall of 2007. They have zero integrity, lack a nanogram worth of accountability and have negative ethics. In one word: evil.
      They are thieves in suits.

      They plead poor, yet can afford stupid babay Super Bowl ads, and now have 500 million in cash on hand, and they are getting a $100 million tax refund bail-out from the government this quarter. They have stolen 167 million from folks in this ARPS mess, and they can afford to pay it back, like Ameritrde did.
      I know forst hand, you have to go after them tooth and nail, as I am currently doing. They have stolen our money for almost 2 1.2 years, and it is well time to put the boot on their neck.


    • raccoon

      E*trade refuses to relase cash in Auction rate Securities



      E*Trade has routinely engaged in questionable, evasive and deceptive legal tactics when sued, frequently claiming it does not have information or money to settle its fraud in solicited auction rate sales. Even when asked by Regulators to turn over documents, and sometimes even ignoring FINRA orders to produce key documents. This firm is the grim reaper to your financial health and mental well being. AVOID

      E*Trade’s Auction Rate Security Fraud
      My story in part:

      I am over 60 years old, and in the fall of 2007 I was lured by E*trade’s ad for a JP Morgan money market fund for an IRA. In Short I called to purchase this money market fund, (the trade could not be placed on-line) I was transferred to their “fixed-income” department and was solicited to buy Auction Rate Securities, for which the market has been frozen since Feb 2008.

      E*Trade, in my opinion, knew the risk of this soon to be illiquid market, yet pawned them off on me and thousands more of their “clients=victims”. They have been totally uncooperative, intransigent, rude, threatening, and unwilling to accept responsibility for their fraud and lies perpetuated by their agents back in late 2007. They offer no solution to help assist those of us caught in this mess, and they continuously deflect, deny, and defend their lack of accountability and irresponsible stance.

      They have effectively stolen my $50,000 in an IRA no less and they only put up a smoke screen with low rent mafioso like attorneys. E*Trade from my experience is pure pond scum, and has zero ethics, and morality. Who on Wall Street does? They are the worst of the worst. RUN, DON’T WALK AWAY FROM E*TRADE, They will *** over financially given the chance and are totally untrustworthy to be a custodian of any one’s money.

  • Bryan

    I’m also battling E*Trade who sold me Nelnet ARPS in January of 2008. Is there anyway we (others fighting E*Trade) can get in touch with each other to share info?

  • Pingback: personal injury attorney temecula()

  • Pingback: How it Works()

Recent Posts