The Securities and Exchange Commission (SEC) has turned to Court as it seeks to enforce BMA Securities’ compliance with an order issued about two years ago. This becomes clear from an application filed by the SEC with the California Central District Court on February 18, 2022.

The document, seen by FX News Group, represents an application by the SEC to enforce compliance by Respondent, BMA Securities, LLC, with a final Commission order entered against it on March 12, 2020. This order required BMA Securities to pay disgorgement of $48,489.23 and prejudgment interest of $10,048.55 with additional interest pursuant to SEC Rule of Practice 600, if timely payment is not made, and to pay a civil penalty of $275,000, with interest accruing pursuant to 31 U.S.C. § 3717, and injunctive relief.

These proceedings arise out of BMA’s failure to comply with certain provisions of Regulation SHO which sets forth certain requirements concerning the short sale of securities. From at least January 2015 through August 2016, BMA, a registered broker-dealer, violated Rule 204 of Regulation SHO (Rule 204) on hundreds of occasions by failing to close out allocated fail to deliver positions (FTD).

On March 12, 2020, the Commission issued an Order instituting administrative and cease-and-desist proceedings, on consent, pursuant to Section 15(b) and 21C of the Securities Exchange Act of 1934 (“Exchange Act”) requiring Respondent to disgorge $48,489.23, and prejudgment interest of $10,048.55 with additional interest pursuant to SEC Rule of Practice 600, if timely payment is not made, and to pay a civil penalty of $275,000, with interest accruing pursuant to 31 U.S.C. § 3717, and injunctive relief.

BMA Securities did not seek review of the Order, and the time to do so has expired.

BMA has not made any payment towards the disgorgement or prejudgment interest, which remains due and owing with additional interest accruing pursuant to SEC Rule of Practice 600, or the civil penalty, which remains due and owning with additional interest continuing to accrue pursuant to 31 U.S.C. § 3717.

The SEC requests that the Court enter an order, directing Respondent to show cause why this Court should not enter an Order enforcing compliance with the Commission Order.

The regulator also seeks an Order enforcing the Commission Order and requiring:

1. BMA Securities to disgorge $48,489.23, and prejudgment interest of $10,048.55 with additional interest pursuant to SEC Rule of Practice 600;
2. BMA Securities to pay a civil penalty of $275,000, with interest accruing pursuant to 31 U.S.C. § 3717; and
3. Compliance with the Injunctive Relief set forth in the Order.