SEC Will Accept $25 Million Offer
WASHINGTON (CN) - The SEC will accept a $25 million settlement offer from Jefferies LLC, which it accused of failing to supervise workers on its mortgage-backed securities desk who lied to customers.
The SEC filed an administrative order Wednesday against Jefferies LLC fka Jefferies & Co.
In a statement announcing its acceptance of the settlement offer, the SEC said: "An SEC investigation found that Jefferies representatives, including Jesse Litvak, whom the SEC charged with securities fraud last year, lied to customers about the prices that the firm paid for certain mortgage-backed securities, thus misleading them about the true amount of profits being earned by the firm in its trading. Jefferies' policy required supervisors to review the electronic communications of traders and salespeople in order to flag any untrue or misleading information provided customers. However, the policy was not implemented in a way to detect misrepresentations about price."
In its 8-page order, the SEC said: "Respondent has submitted an Offer of Settlement ... which the Commission has determined to accept."
The $25 million payment will also settle a parallel action filed by the U.S. attorney.
Litvak was criminally convicted last week of multiple counts of securities fraud.