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The Wells notice was issued to the index provider for failing to provide sufficient disclosures on some volatility-related indexes in 2018, according to the filing https://www.sec.gov/ix?doc=/Archives/edgar/data/64040/000006404020000144/spgi-20200630.htm from Tuesday.
The SEC is planning to file an enforcement action against the index provider, a joint venture between S&P Global and exchange operator CME Group (O:CME), the filing said.
“The proposed action would allege violations of federal securities laws with respect to the absence of disclosure of a quality assurance mechanism and the impact of that mechanism on certain volatility related index values published on one business day in 2018,” S&P Global said in the filing.
“The Staff’s recommendation may involve a civil injunctive action, a cease and desist proceeding, disgorgement, pre-judgment interest and civil money penalties.”
A Wells notice does not necessarily mean the SEC will bring any action against the company or that the recipient has violated any law.
“S&P Dow Jones Indices has established rigorous processes to maintain the transparency and integrity of our benchmark determination process, and protect the independent governance and quality of our indices,” an S&P spokeswoman said in an email.