The Securities and Exchange Commission urged municipal borrowers and underwriters to voluntarily report violations, allowing them to avoid steeper penalties after an investigation, Bloomberg News reported yesterday. The regulator today said that it created an enforcement program providing standardized settlements for borrowers and banks that report running afoul of the law. For states and cities, it would let them avoid financial penalties. “We encourage eligible parties to take advantage of the favorable terms we are offering,” said Andrew Ceresney, director of the SEC’s enforcement division. “Those who do not self-report and instead decide to take their chances can expect to face increased sanctions for violations.” The commission has toughened enforcement against state and local governments that borrow in the $3.7 trillion municipal-bond market, seeking to protect investors from being harmed by inadequate or misleading disclosures.
