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Credit Suisse Settles with SEC over Deficient Data Submission

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Credit Suisse Securities (USA) LLC - a subsidiary of Credit Suisse Group AGCS - is set to pay $4.25 million to the Securities and Exchange Commission (SEC) for providing deficient information to the regulator regarding its customer trades for a period of two years.

The SEC stated in its release that Credit Suisse Securities admitted that it violated the recordkeeping and reporting provisions of the federal securities laws.

The concerned information, known as "blue sheet data" are electronically provided by broker-dealers like Credit Suisse Securities upon request by the SEC, which enables the regulator in identifying and analyzing trades during investigation and other operations. "Blue sheet" indicates the color of the form originally mailed to broker-dealers to fill up and return to the SEC However, in the 1980s, the procedure shifted to an electronic format.

Highlighting the importance of the submissions, the SEC order mentioned, "the failure of a broker-dealer to provide complete and accurate blue sheet information in response to a Commission request can impact the Commission's ability to discharge its statutory obligations, undermine the integrity of its investigations and examinations, and ultimately interfere with the Commission's ability to protect investors."

According to the SEC order "apparent discrepancies in Credit Suisse's blue sheet submissions" were revealed when in a related probe, the SEC staff compared the blue sheet submissions from certain broker-dealers to equity cleared data from the National Securities Clearing Corp for the same broker-dealers and the same time period.

Notably, New York-based Credit Suisse Securities admitted that from the period of January 2012 to January 2014, it made at least 593 deficient blue sheet submissions to the SEC, omitting over 553,400 reportable trades representing 1.3 billion shares.

The deficient blue sheet submissions were due to certain technological and human errors, as identified by the company. Addressing the issue, Credit Suisse employed several changes in order to ensure the accuracy of its blue sheets.

The latest settlement is not likely to impact the financials of the Swiss banking giant, and bring some relief amid several of its legal woes.

Credit Suisse currently carries a Zacks Rank 4 (Sell). Some better-ranked stocks in the foreign banks space include Erste Group Bank AG EBKDY , Mitsubishi UFJ Financial Group, Inc. MTU and Deutsche Bank AG DB . While Erste Group sports a Zacks Rank #1 (Strong Buy), both Mitsubishi UFJ and Deutsche Bank carry a Zacks Rank #2 (Buy).

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CREDIT SUISSE (CS): Free Stock Analysis Report

DEUTSCHE BK AG (DB): Free Stock Analysis Report

MITSUBISHI-UFJ (MTU): Free Stock Analysis Report

ERSTE GROUP BNK (EBKDY): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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