Munis were especially hard-hit by the rise in long-term Treasury yields because tax-exempt issuers, such as state and local governments, tend to issue more long-term bonds than do corporate issuers.

WSJ: Tax-Cut Deal Results in Turmoil for Bonds

Ms. Whitney forecast that a few hundred issuers of tax-exempt bonds will default on their bonds over the next several years.

FORBES: Municipal Bond Closed-End Funds Attractive

Then there are tax-exempt issues available from tens of thousands of issuers.

FORBES: Yield Booster

Such conduct caused municipal issuers to file inaccurate reports with the Internal Revenue Service and placed the tax-exempt status of the underlying bonds in jeopardy.

FORBES: Guilty Pleas In Antitrust Division Municipal Bond Bid Rigging Case

The criminal information to which Hertz pled guilty charged, among other things, that Hertz engaged in fraudulent misconduct in connection with the competitive bidding process for the selection of the firms to provide instruments in which municipal issuers, in accordance with federal tax laws and regulations, temporarily invested the proceeds of tax-exempt municipal bonds.

FORBES: SEC Puts the Lopsided Hurt on Hertz