Piper Jaffray, Dougherty To Pay SEC Penalties
Two Minneapolis-based financial firms, Piper Jaffray Companies and Dougherty & Company LLC, have agreed to pay civil penalties to the U.S. Securities and Exchange Commission in connection with a nationwide enforcement action related to violations in municipal bond offerings.
The SEC announced the enforcement actions against 36 municipal underwriting firms on June 18. Piper Jaffray and Dougherty were the only two Minnesota companies named in the action.
Under the settlement, Piper Jaffray will pay $500,000 to the SEC, while Dougherty & Company will pay $250,000.
Representatives of Piper Jaffray and Dougherty could not be reached for comment.
The SEC statement on the settlements noted: “In today’s actions, the SEC alleged that between 2010 and 2014 the 36 firms violated federal securities laws by selling municipal bonds using offering documents that contained materially false statements or omissions about the bond issuers’ compliance with continuing disclosure obligations. The underwriting firms also allegedly failed to conduct adequate due diligence to identify the misstatements and omissions before offering and selling the bonds to their customers.”
The SEC’s Enforcement Division announced an initiative in March 2014 which offered “favorable settlement terms to municipal bond underwriters and issuers who self-reported securities law violations.” The cases announced last week were the first brought under the voluntary, self-reporting program.
Settlements from the 36 firms totaled $9.29 million. The maximum penalty for any single firm was $500,000.
As part of the settlement, the firms “did not admit or deny the findings.” As part of the agreement, each firm must also “retain an independent consultant to review its policies and procedures on due diligence for municipal securities underwriting.”