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WASHINGTON, July 31 The U.S. Securities and
Exchange Commission is expanding an initiative for municipal
bond issuers and underwriters to voluntarily report inaccurate
statements they made in disclosures and pay standardized
settlements, it said on Thursday.
The regulator, which enforces the rules the Municipal
Securities Rulemaking Board writes, has pushed the deadline for
issuers to report violations under the initiative launched this
spring to Dec. 1 from Sept. 10. The deadline for underwriters to
report remains Sept. 10.
"It is clear that many underwriters and issuers are working
diligently to take advantage of the initiative within its time
period," said Andrew Ceresney, director of the SEC's enforcement
division, in a statement. "These adjustments to the program are
designed to encourage as much participation as possible, which
we expect will ultimately benefit investors by encouraging
improved compliance with continuing disclosures by the broadest
group of industry participants."
If the SEC identifies violations after the initiative ends,
it will consider "reasonable, good faith, and documented
efforts" to report them when deciding on any enforcement actions
At the same time, the commission has created tiered
penalties for underwriters' violations, in the hopes of
encouraging smaller firms to participate. Those with total
annual revenue of less than $20 million will have to pay fines
of $100,000, while those with income of more than $100 million
have penalties of $500,000.
The SEC did not say how many issuers and underwriters have
participated in the initiative since it was unveiled in March.
(Reporting by Lisa Lambert; Editing by Lisa Shumaker)