A federal jury has found that the city of Miami defrauded bond investors by making the investments appear to be a better deal than they actually were.
The verdict Wednesday came in a U.S. Securities and Exchange Commission civil lawsuit against the city and a former budget director. The Miami Herald reports the SEC may seek civil penalties against the city.
The jury concluded the city acted knowingly or with recklessness that misrepresentations were made to investors about the $153 million in bonds in 2009. Jurors also found former budget director Michael Boudreax liable for securities law violations.
The case emerged as the city was shifting money between accounts to make it appear financially healthy, moves that later forced Miami to raise taxes and cut employee pay and benefits.