Gretchen Morgenson in the Sunday Times shed some more light on the UBS auction-ratings securities soon-to-be-scandal (That would make at least two at the Swiss bank, which is also in trouble for helping billionaires evade their taxes and whose vice-chairman Phil Gramm co-chairs John McCain’s presidential campaign). Auction-rate securities are the instruments sold to investors as being “safe as cash” and provided long-term financing for governments and non-profits at short-term rates.

Interestingly, one email suggests that UBS wasn’t the only one trying to unload its junk on investors who didn’t know any better:

“As you can imagine during these stressful times, the pressure is on to move our inventory,” wrote David Shulman, global head of fixed income distribution at UBS, on Aug. 30. “I am aware that JP(Morgan) and Citi are on all ‘alert’ in the same fashion with their retail groups.”

Shulman was unloading his own auction-rate securities holdings, as Morgenson notes, because they didn’t suit his “risk tolerance.” And she notes that it appears UBS was even deceiving (by omission) its own brokers to facilitate the unloading.

“We continue to be frustrated by the lack of information that they are providing to us,” one broker wrote about the firm’s auction-rate unit in a Jan. 10 message. “Given the strange and difficult environment, it is imperative that we are fully aware of the risk we are taking. We do not want to imperil any relationships over something as ‘simple’ as their cash investments. The lack of clarity regarding ARPS is contrary to our focus on ‘improving the client experience.’ ” (ARPS refers to auction-rate preferred shares.)

UBS even used the word “unload” to describe what it was doing with the auction-rate paper. This on February 12, as it was becoming more apparent that the market was collapsing and just a day or so before it totally died, from an exec:

“We need to beat the bushes harder than ever to unload this paper.”

The Financial Times today says authorities are on top of this so quickly because “Main Street” investors have been affected.

All this has the lawyers licking their chops, Investment News says.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.