Regulation

The Financial Industry Regulatory Authority announced Thursday it has reached settlements with units of HSBC and U.S. Bancorp related to the sale of auction-rate securities that became illiquid when auctions froze in February 2008.

The civil suit filed against Goldman Sachs by the Securities & Exchange Commission alleging securities fraud could strengthen the argument to establish a universal fiduciary standard, according to legal experts.

The Department of the Treasury on Friday issued a questionnaire to primary dealers asking them how the SEC’s new money market fund rules, which take effect on May 5, could impact demand for Treasuries and the broader Treasury repo and cash market functioning. Treasury is seeking the information ahead of a meeting with the dealers on April 30.

Dodd calls for study on performance information in advertisements.

Senate Banking Committee Chairman Chistopher Dodd (D-Conn.)’s financial overhaul bill takes issue with performance information in mutual fund advertisements and asks for a review of the practice by the comptroller general.

The regulator fined units of the two banking companies $1.5 million and $275,000 respectively for auction rate securities violations.

Brokers voice concerns at Mutual Fund Directors Forum.

The federal government’s Financial Crisis Inquiry Commission has subpoenaed Moody’s Corp. for allegedly failing to provide requested information.

The Justice Department is seeking to intervene and temporarily halt fact-finding by a group of localities in their class action suit against Wells Fargo & Co. and 15 other banks, broker-dealers and investment brokers for allegedly conspiring to rig bids and fix prices of investment and derivatives contracts in the municipal market.

Despite recent tough talk about problems with the regulatory reform bill, Republicans are unlikely to win significant concessions as the legislation moves to the Senate floor.