SEC Seeks to Enforce 2014 Settlement with City of Harvey
From the Desk of Jim Eccleston at Eccleston Law LLC:
In December 2014, the city of Harvey, IL, settled claims made by the U.S. Securities and Exchange Commission (“SEC”) that Harvey misled investors regarding a municipal bond. Under the terms of that settlement, the city was required to maintain an independent consultant to advise the city on policies and procedures related to controls and oversight of its financial reporting for at least three years. The settlement did not require Harvey to pay a financial penalty.
The SEC has now filed a request in federal court to enforce the judgement, saying that Harvey has failed to adequately improve its policies and procedures as required by the 2014 settlement agreement. According to the SEC’s filing, an independent consultant found that Harvey had failed to implement 19 of 32 recommendations made by an independent auditor. The SEC also alleged that an independent consultant found that Harvey’s internal controls were still “unreliable and informal.”
The city of Harvey claimed that many of the open issues had already been remediated. As reported by Law360, the city pointed to the hiring of new personnel, the purchase of a new payroll and human resources system, and modifications made to the IT infrastructure as evidence that it had complied with the SEC’s order. However, the SEC did not find these changes sufficient and found these changes to not address issues with the city’s internal controls.
Eccleston Law also practice a variety of other areas of practice for financial investors and advisors including Securities Fraud, Compliance Protection, Breach of Fiduciary Duty, FINRA Matters, and much more. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services. If you are in need of legal services, contact us to schedule a one-on-one consultation today.
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