Wednesday, November 15, 2006
Yesterday, another shoe dropped in the San Diego pension scandal. And this one slipped off of a very big foot of the SEC. The Securites and Exchange Commission said the City of San Diego defrauded bond holders by withholding information about financial problems. The misstatements related directly to $260 million in municipal bond issues. They were subsequently copied into additional bond issues, totaling $2.3 billion in bonding. Currently, the city's borrowing power is basically shut down due to a suspension of its credit rating.
So what does this mean? For one thing, the SEC has ordered San Diego to submit to three years of independent oversight. What else does it mean?
city attorney for the City of San Diego.