The SEC on April 12 instituted cease and desist proceedings againstINTL FCStone Inc. overalleged violations of the reporting, books and records, and internal control provisionsof the Securities Exchange Act.
The SEC found that between fiscal year 2010 and June 30, 2013,the company overstated its operating revenues by $10 million and its net incomeby $6 million as a result of accounting errors in recording and reporting over-the-counterderivative trading gains at subsidiary INTL FCStone Markets LLC. INTL FCStone'sinternal accounting controls failed to timely prevent the accounting errors, theSEC said.
In January 2014, INTL FCStone restated its financial statements,determined that certain of its controls were not operating effectively, and reportedthe existence of a material weakness in internal control over financial reportingas of Sept. 30, 2013.
Without admitting or denying the findings, INTL FCStone agreedto cease and desist from any future violations of the Exchange Act and to pay acivil money penalty of $150,000 within 30 days of the entry of the order.