Raymond James reached an agreement with state securities regulators and the SEC in late June over sales of auction rate securities. As part of the deal, which affects ARS sales made before mid-February 2008, Raymond James will buy back the ARS at par value, which is now about $280 million, and pay a fine of $1.75 million to state regulators. At the time of purchase, the ARS were valued at $2.1 billion.
“I am pleased we are able to resolve this issue and provide liquidity to clients who continue to hold ARS in their portfolios,” said CEO Paul Reilly in a press release. As a result of the agreement, Raymond James says it will take a pre-tax charge of about $50 million in the quarter ending June 30, 2011.