MIAMI (CBSMiami/AP) — The U.S. Securities and Exchange Commission may seek civil penalties against the City of Miami after a federal jury found that it defrauded bond investors in 2009 by making the investments appear to be a better deal than they actually were.
The verdict came Wednesday the SEC’s civil lawsuit against the city and a former budget director.
The jury concluded the city acted knowingly or with recklessness that misrepresentations were made to investors about the $153 million in bonds. Jurors also found former budget director Michael Boudreax liable for securities law violations.
The case emerged as the city was shifting money between accounts to make it appear financially healthy, moves that later forced Miami to raise taxes and cut employee pay and benefits.
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