Options Clearing Corp. agreed to pay $20 million in penalties to settle charges that it failed to implement policies to manage certain risks as required by U.S. laws and SEC and Commodity Futures Trading Commission rules.
The SEC and the CFTC found that Options Clearing failed to establish and enforce policies and procedures involving financial risk management, operational requirements and information-systems security. The SEC also found that Options Clearing changed policies on core risk management issues without its approval.
Options Clearing will pay $15 million under the SEC's order and $5 million under the CFTC's order. Aside from paying the penalties, Options Clearing also agreed to hire an independent compliance auditor to assess its remediation of the violations and subsequent compliance efforts. Options Clearing neither admitted nor denied the findings of the regulators.
In a statement, Options Clearing CEO John Davidson said that "most of the compliance remediation is now complete and any remaining actions are on a path to be completed expeditiously."
