07 November 2017
Washington DC
Reporter: Jenna Lomax

Millennium Management violates SEC security laws


Millennium Management has agreed to settle charges of illegal short selling in advance of stock offerings.

The New York-based investment advisory firm agreed to pay more than $630,000 to settle the charges after it admitted that it shorted US stocks in companies planning follow-on offerings, and then illegally bought shares in those follow-on offerings.

The US Securities and Exchange Commission (SEC) claimed that by purchasing shares in the follow-on offerings, Millennium Management gathered $286,889 in illegal profits.

Millennium must pay back all ill-gotten gains, plus interest of $51,820 and a penalty of $300,000.

The SEC found that Millennium Management violated an anti-manipulation provision of the federal securities law, Rule 105, across four occasions back in 2012.

In a statement on the ruling, the SEC explained: “Rule 105 prohibits short selling an equity security during a restricted period (generally five business days before a covered public offering) and then purchasing that same security through the offering.”

Sanjay Wadhwa, senior associate director of SEC in New York, said: “Millennium established and maintained certain accounts that improperly participated in public offerings despite other firm accounts being short the relevant securities.”

“We will continue to actively surveil for, and charge, violations of Rule 105 where appropriate.”

More news
The latest news from Securities Lending Times
Join Our Newsletter

Sign up today and never
miss the latest news or an issue again

Subscribe now
Hedge funds continue 2017 run
23 November 2017 | Madrid | Reporter: Drew Nicol
Global AUM of hedge funds rose 24 percent to $3.2 trillion in the past two years, according to data captured by IOSCO’s latest market survey.
Goldman Sachs appointed by Thrivent for agent lending
23 November 2018 | Minneapolis | Reporter: Jenna Lomax
Thrivent Financial has appointed Goldman Sachs as it new lending agent
ICMA maps repo and cash bond operations
22 November 2017 | Zurich | Reporter: Zsuzsa Szabo
ICMA has launched a free-to-read mapping directory for more than 80 technology solutions for repo and cash bond operations
FCA publishes MiFID II guide
22 November 2017 | London | Reporter: Jenna Lomax
The guide focuses on the regulatory regime in MiFID II for trading venues and data reporting services providers
Hedge fund industry reaches new highs in Q3
22 November 2017 | London | Reporter: Zsuzsa Szabo
The hedge fund industry has recorded strong performance in Q3 2017, after stumbling in 2016, according to Preqin
India reviews SBL position limits
21 November 2017 | New Delhi | Reporter: Zsuzsanna Szabo
The Securities and Exchange Board of India has altered its securities lending rulebook, following market calls for change
EU Commission opens consultation of SFTR TR fees
21 November 2017 | Paris | Reporter: Drew Nicol
UK-based trade repositories may be forced to shoulder additional third-party recognition fees to operate under EU regulatory frameworks post-Brexit, according to proposed EU Commission rules