Switzerland's biggest bank, UBS AG, has agreed to pay $160 million to settle charges that it rigged the bidding process for investment contracts with cities and towns in 36 states.
Federal and state officials announced the settlements Wednesday. UBS admitted and accepted responsibility for illegal, anticompetitive conduct by former employees from 2001 through 2006, the Justice Department said.
The local governments were looking to invest their proceeds from municipal bond sales. Former UBS employees manipulated the bidding process and at times paid kickbacks to bidding agents who collect proposals for government business, the Justice Department and the Securities and Exchange Commission said. UBS also acted as a bidding agent for municipalities and rigged bids for the benefit of other financial firms, the authorities said.
The $160 million is being paid as restitution and penalties to federal and state agencies. Because UBS admitted to the conduct and cooperated, it isn't being prosecuted.