SEC commissioner Daniel Gallagher attacked municipalities’ accounting practices at the MSRB Municipal Securities Regulator Summit in Washington D.C. yesterday, saying that there is $3 trillion in unfunded liabilities that is being hidden from investors with accounting tricks and that “this lack of transparency can amount to a fraud on municipal bond investors.”
“In the private sector, the SEC would quickly bring fraud charges against any corporate issuer and its officers for playing such numbers games,” said Gallagher. “We should not treat municipalities any differently.”
It’s no secret that municipal pensions and other post-employment benefits (OPEB) are...
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