Investigation and pending class action against SunTrust Bank and its wholly owned broker subsidiary SunTrust Robinson Humphrey (SunTrust Bank and its wholly owned broker subsidiary SunTrust Robinson Humphrey )
Investigation and pending class action against SunTrust Bank and its wholly owned broker subsidiary SunTrust Robinson Humphrey (SunTrust Bank) on behalf of investors who purchased auction rate securities from SunTrust Bank.
Auction rate securities are also known as auction rate preferred stock; auction market preferred stock; variable rate preferred securities; money market preferred securities; auction rate bonds.
SunTrust Bank represented to investors that auction rate securities were equivalent to cash or money market funds, were highly liquid and safe investments for short term investments. SunTrust Bank and its wholly owned broker subsidiary SunTrust Robinson Humphrey knew but failed to disclose material facts about auction rate securities including the fact that auction rate securities were in fact long-term financial instruments that were artificially supported and manipulated by broker-dealers thereby creating the appearance of liquidity and stability.
On February 13, 2008, 87% of all auction for auction rate securities failed. This collapse left investors holding 300 billion in auction rate securities with no means of liquidating the investments.
Defendant Details
Name (Stock Symbol)
Brief Description
SunTrust Banks, Inc. (STI)
SunTrust Banks, Inc. operates as the holding company for SunTrust Bank, which provides various financial services to consumer and corporate customers in the United States.