IRS Threatens to Declare N.J. Board's Issue Taxable

Ferris, Craig T.
June 2003
Bond Buyer;6/6/2003, Vol. 344 Issue 31651, p1
Trade Publication
The U.S. Internal Revenue Service (IRS) is threatening to declare $9.525 million in bonds issued by Oakhurst, New Jersey-based high school Ocean Township, Board of Education taxable unless Wachovia Bank agrees to pay the government about $200,000, to settle a yield-burning case in which a predecessor securities firm sold the district open-market securities that generated illegal arbitrage profits. The board's release also said that the school district has hired two outside law firms, which are evaluating the IRS preliminary determination that the bonds are taxable, and indicated that it is considering suing Wachovia.


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