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Ameritrade cuts fraud deal, focus shifts to Schwab

NEW YORK&rsquo;S attorney general, who is probing illegal marketing and sales of auction rate securities, said yesterday he intends to charge US brokerage Charles Schwab with civil fraud and has reached a settlement with rival TD Ameritrade.<br /><br />Schwab denied the allegations calling them &ldquo;without merit.&rdquo;<br /><br />But TD Ameritrade agreed to return $456m (&pound;276m) to investors holding auction rate securities (ARS), which was a market that froze early last year.<br /><br />New York Attorney General Andrew Cuomo said: &ldquo;Today&rsquo;s notice should send a signal that if Charles Schwab will not stand by its customers, this office will.&rdquo;<br /><br />The TD Ameritrade settlement brings to about a dozen the number of brokerages and other firms that have agreed to buy back more than $61bn in ARS from investors, said Cuomo, calling it &ldquo;the single largest consumer recovery in history.&rdquo;