Here's how LA Times reporter Martin Zimmerman reports California Attorney General Jerry Brown's allegations:
Wells Fargo subsidiaries sold auction-rate securities "on the basis that they were like cash and people could get their money back in eight days," California Atty. Gen. Jerry Brown said. "But they were not like cash and people can’t get their money back even after many, many months, and they’re mad as hell.”Wells Fargo Accused of Securities Fraud in [CA] State Lawsuit
Atty. Gen. Jerry Brown says the banking giant's subsidiaries told buyers that $1.5 billion of risky auction-rate securities were safe. Wells says it tried to help customers when the market collapsed.
By Martin Zimmerman, LA Times
April 24, 2009
The state of California accused Wells Fargo & Co. of FRAUD Thursday for the company's role in an investment meltdown that has been compared to the Bernard Madoff scandal in magnitude.
- - - Atty. Gen. Jerry Brown sued three Wells Fargo investment subsidiaries, alleging they COMMITTED SECURITIES FRAUD by telling California investors that $1.5 billion of risky securities sold to them were as safe as cash.
- - - The securities "were sold to customers on the basis that they were like cash and people could get their money back in eight days," Brown said in an interview. "Now, it turns out they were not like cash and people can't get their money back even after many, many months, and they're mad as hell."
The lawsuit, filed in state court in San Francisco, seeks to recover the money invested by about 2,400 Californians in what are known as auction-rate securities marketed by the Wells Fargo subsidiaries...Wells Fargo accused of securities fraud in state lawsuit