The Securities and Exchange Commission announced today that it has settled misleading disclosures with Bloomberg Finance LP (Bloomberg) regarding BVAL, a paid subscription service that provides daily valuations of fixed income securities to financial services entities. bottom.
According to the SEC order, from at least 2016 through October 2022, Bloomberg will tell BVAL clients that the valuation of certain fixed income securities may be based on a single data input, such as a broker’s quote. You didn’t disclose something. Previously disclosed methodology. Bloomberg believes that clients, including mutual funds, may use BVAL prices to determine the valuation of fund assets, including valuations of fund investments in governments, international organizations, agencies, corporate bonds, municipal bonds and securitized products. Bloomberg has acknowledged that and that the BVAL may affect the price of an offering or trading of securities.
“Bloomberg plays an important role as a pricing service to bond market participants, and Bloomberg and other pricing services have an obligation to provide accurate information to their clients about the valuation process,” said Osman Nawaz. There is,” he said. , Chief of the Complex Financial Products Unit of the Executive Department. “This issue highlights the liability of service providers such as Bloomberg for misrepresentations that affect investors.”
See also: SEC indicts Goldman Sachs for failing to follow ESG investment policy, Barclays agrees to $361 million settlement to resolve SEC indictment related to securities over-issuance, SEC seeks financial Mattel Sued for False Representation, Former PwC Audit Partner Indicted for Improper Professional Conduct
The SEC order finds that Bloomberg has violated Section 17(a)(2) of the Securities Act. Bloomberg has agreed to stop and terminate future violations and pay a $5 million fine without acknowledging or denying the findings of the investigation. The SEC order notes that Bloomberg has voluntarily undertaken remedial efforts to improve his BVAL business unit.
The SEC’s investigation was conducted by Gregory Smoler of the Multi-Instruments Division and Emily Rothblatt of the Chicago Regional Office under the supervision of Natalie Branson, Ana Petrovic and Osman Nawaz of the Multi-Instruments Division. Howard Kaplan, Executive Research and Market Analysis Office;
Source: US Securities and Exchange Commission
