California City, Underwriter Misled Investors, SEC Says
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U.S. regulators accused Victorville, California, and underwriters of lying to investors by inflating property values backing $13.3 million of municipal bonds to redevelop a closed air force base.
The Securities and Exchange Commission in a complaint filed today in federal court said assistant City Manager Keith Metzler and underwriter Kinsell, Newcomb & DeDios doubled the value of four hangars at the Southern California Logistics Airport to $65 million so it could borrow more money against the property, formerly George Air Force Base.