Stifel Nicolaus & Co. Inc. and BMO Capital Markets Corp. agreed to pay $2.7 million and $1.95 million, respectively, to settle the SEC's charges that they provided incomplete and inaccurate securities trading information to the regulator.
Over a period of several years, Stifel and BMO each made numerous deficient blue sheet submissions containing missing or inaccurate data, largely due to undetected coding errors, according to the SEC's orders instituting administrative and cease and desist proceedings. Stifel failed to report data for approximately 9.8 million transactions and provided inaccurate information for about 1.4 million transactions, while BMO submitted missing or incorrect data for about 5.4 million transactions.
Neither company had adequate processes designed to validate the accuracy of its submissions, and each willfully violated the broker/dealer books and records and reporting provisions of the federal securities laws, according to the SEC's findings.
The two companies admitted the findings and agreed to be censured and to pay penalties. Each company has engaged in remedial efforts to address the causes for its deficient submissions, including the retention of an outside consultant and the adoption of new policies and procedures for processing blue sheet requests.
