The Bank of America Corp recently announced that as part of a settlement with Massachusetts regulators, they will be buying back $4.5 billion in auction-rate securities, that are held by about 5,500 customers. The securities were a system of investors buying/selling a type of corporate debt, and the interest rates were reset at auctions, at times as often as once a week. The securities market had fell apart in February and the Securities and Exchange Commission and the NY Att. General´s office had been investigating the collapse since then. Linda Thomsen, the director of the enforcement division with the SEC, stated that "The SEC Division of Enforcement expects to soon announce the terms of a preliminary settlement with Bank of America that results from our ongoing auction-rate securities investigations,". This settlement would include the $4.5 billion they will be shelling out in buying back the securities.

The Bank of America will be buying back the securities at the rate of which they were purchased by the clients. This will start on Oct. 1^st until the end of the year. The buy back offer is available for individual investors and trusts that benefited individuals who bought securities before Feb. 11, as well as businesses with an account value up to $10 million and charities with a value up to $25 million. Jerry Dubrowski, the Bank of America spokesman, said that, "We fully recognize the effect that the unprecedented market conditions have had on our clients, and we appreciate their patience as we worked with the regulators to reach an agreement that would provide liquidity relief to the investors,".

The Bank of America expects a pretax charge of $275 million from the buy back program. They and about 8 other investment banks have joined in the agreement to buy back almost $50 billion in securities.