Ashley Perry Oct. 6, 2014, 11:24am

RBC Capital Markets LLC will pay $990,000 in restitution to 63 Houston Area municipal utility districts as part of a settlement reached with Texas Attorney General Greg Abbott on Friday to resolve anticompetitive activities involving underwriting fees paid by the utilities.

The global bank provides financial advice and underwriting services to state and government agencies in an effort to guide them through the process of issuing bond debt and bringing bond issues to market.

In 2003, the bank allegedly agreed to allocate customers and not compete with former RBC financial advisor R. Craig Rathmann. As part of the agreement, RBC agreed not to solicit any of Rathmann's financial advisory clients in return for Rathmann only using RBC as the lead underwriter for his clients. A secure fee of 1.25 percent of bond sale proceeds was also agreed upon. 

Because of this agreement, the state said the municipal utility districts and taxpayers were denied the benefits of competitive rates from other companies.

As part of the settlement agreement reached with the state of Texas, RBC is prohibited from entering into similar non-compete arrangements in the future.

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Texas Office of the Attorney General
300 W 15th St
Austin, TX 78701

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