Two major U.S. investment banks have agreed to settlements with New York state on alleged mishandling of sales of auction-rate securities, the state's attorney general said Thursday. Morgan Stanley has agreed to pay a $35 million penalty, while J.P. Morgan Chase will pay $25 million, Attorney General Andrew Cuomo said. The settlements cover more than $7 billion worth of securities, he said. Settlements related to auction-rate investigations so far—including with other banks—will result in the return of over $30 billion to investors, Cuomo told a New York City news conference.
