SEC Extends MCDC Initiative Deadline for Issuers and Obligors; Civil Penalty Caps for Underwriters Tiered by Revenues

August 1, 2014
Client Alert

The SEC announced modifications to its Municipalities Continuing Disclosure Cooperation Initiative on July 31, 2014 as follows: 

It extends the deadline for issuers and obligors to self-report potential violations from September 10, 2014 to December 1, 2014. The deadline for underwriters is not changed and remains September 10, 2014.

The cap on civil penalties for underwriters that self-report is tiered as follows:

It acknowledges the difficulty of identifying potential violations for periods that pre-date the EMMA system, and states that if violations are identified by the Enforcement Division after the expiration of the MCDC Initiative, the SEC will consider “reasonable, good faith, and documented efforts” in deciding whether to recommend enforcement action and in determining relief if enforcement action is recommended.

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