Judge Throws Out SEC ARS Suit

Business Week reports that U.S. District Court Judge granted Regions Financial Corp’s Morgan Keegan brokerage unit a summary judgment, rejecting Securities and Exchange Commission arguments that the company misled auction-rate securities investors before the 2008 market collapse. While the SEC alleged that Morgan Keegan intentionally misrepresented ARS liquidity risks, the judge found, “Failure to predict the market does not amount to securities fraud.” The SEC may appeal the decision.