The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against Stifel Financial over fraud in the sale of notes tied to synthetic collateralized debt obligations (CDOs), The Wall Street Journal reports. The Louis-based firm has been accused of misleading officials at five Wisconsin school districts by telling them the investments made in 2006, which ended up failing, were safe. The districts utilized $37.3 million of their own cash and borrowed $162.7 million to invest in the securities in 2006, adds Bloomberg. The SEC has also alleged that former senior vice president David Noack misled officials about the risks of products typically sold to hedge funds, banks and insurers.
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