Since 2013, federal scrutiny of municipal bonds has dramatically accelerated. Fines and other sanctions are now being imposed by the SEC against a wide swathe of local governments and officials. City and county officials now have unavoidable responsibility to read and stand behind bond disclosures.
Expanding Municipal Securities Enforcement: Profound Changes for Issuers & Officials, a new book by Robert Doty (published by the International Municipal Lawyers Association), discusses three key points:
* The recent SEC enforcement aggressiveness leading to fines for issuers and officials, conditions on issuers' future issuance of bonds, bars against officials' participation in the market, and many other "firsts."
* Control person liability (broadly construed), which applies even in the absence of fraud or negligence by key officials and places a burden on the officials to prove that they acted in good faith and did not induce an issuers' fraud.
* Liability for...