Broker-dealer Jefferies LLC to pay nearly $4 million fine to settle SEC charges

WASHINGTON (Reuters) – Broker-dealer Jefferies LLC agreed on Monday to pay a nearly $4 million fine to settle charges related to American Depositary Receipts (ADRs) abuses, the U.S. Securities and Exchange Commission said on Monday.

The charges, which the broker has neither admitted or denied, come as one of 14 enforcement actions against a bank or a broker stemming from widespread SEC investigations into “abusive practices” related to ADRs, which are U.S. securities that represent foreign shares of a foreign company and require a corresponding number of foreign shares to be held in custody at a depositary bank.

“This line of cases demonstrates the SEC’s commitment to holding financial institutions accountable for engaging in abusive ADR pre-release practices,” said Sanjay Wadhwa, a enforcement director in the agency’s New York Regional Office.

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