New York Attorney General Andrew Cuomo sued banking giant UBS for fraud Thursday, accusing the company of marketing tens of billions of dollars of auction-rate securities as safe even when they knew the investments were in trouble.

The civil lawsuit claims bank executives pulled their personal investments from the floundering market last winter when they realized a crisis was brewing but continued to tell customers all was well.

“They knew what was happening to the market,” said Cuomo deputy Eric Corngold. “Buyers of these securities didn’t have a clue.”

UBS said in a statement that while some of its employees exercised “poor judgment,” none had engaged in illegal conduct.

“It is frustrating that the New York attorney general has filed this complaint while we have been fully engaged in good faith negotiations with his office to bring liquidity to our clients holding auction-rate securities,” the statement said.

The company said it had attempted to support the auctions “longer than any other major firm” and would defend itself vigorously against claims that it abandoned customers.

The lawsuit, filed in state court in Manhattan, is expected to be just one in a string of actions against banks for their conduct in the $330 billion auction-rate securities market.

UBS already faces similar civil charges in Massachusetts, and Cuomo’s office has subpoenaed records from other financial institutions.

“UBS is not alone in this scheme,” Cuomo said at a news conference Thursday. “We are looking at a number of other banks.”

New York’s lawsuit names as defendants UBS Securities LLC and UBS Financial Services Inc., both units of UBS AG, based in Switzerland.

While investigators said they had identified several UBS employees who sold $21 million of their personal stakes in the market in the months leading up to its collapse, the lawsuit does not target individual executives. It also withholds the names of the UBS employees who are accused of dumping their personal holdings.

For years, banks promoted auction-rate securities as being both secure and liquid. They were issued by a broad range of municipal authorities, students lenders and others. Their primary difference from traditional bonds is their interest rates were reset at regular auctions, some as frequently as every week.

But tens of thousands of buyers were stuck holding the securities for months or longer when the auction market collapsed last February due to turmoil in the credit markets. The investment banks that had guaranteed liquidity pulled back, leaving sellers with no willing buyers.

Cuomo said his primary goal was to force UBS to make those assets liquid again for some 50,000 customers who have been unable to access $37 billion.

“People want and need their money back,” he said.