Taxpayer Money: Banks Take $211 Million In Fees For Bond Auctions That Never Happened

Taxpayer Money: Banks Take $211 Million In Fees For Bond Auctions That Never Happened

March 10 (Bloomberg) -- From Carnegie Hall in New York to the Los Angeles bus and subway system, American taxpayers are paying investment banks millions of dollars in fees for bond auctions that never happened.

State and local governments will spend about $211 million this year for the failed sales, based on the 0.25 percent average annual fee charged on the $84.5 billion of outstanding securities, according to data compiled by Bloomberg. The bonds - - long-term debt with interest rates reset through auctions every 7, 28 or 35 days -- typically require issuers pay their bankers even if auctions fail.

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