SEC Delays $ 9 Million Payment for Investors Affected by Poor Valuation of VIX Futures


What would you like to know

  • Its execution division needs more time to locate and verify investor contact information.
  • The poor valuation was due to an undisclosed automatic hold feature of the S&P 500 VIX Short Term Futures Index.
  • The index was licensed to VelocityShares Daily Inverse VIX Short Term ETN (XIV).

Investors aggrieved by the poor valuation of VIX futures by S&P Dow Jones Indices (S&P DJI) will have to wait until next year to collect their share of the company’s $ 9 million fine collected by the Securities and Exchange Commission .

The SEC has created a fair fund so that the penalty can be distributed to investors who have been harmed by the poor assessment, but its enforcement division needs more time to locate and verify investor contact information, compile records. investors, complete the solicitation and appointment of the fund administrator. process and then develop its plan, according to the agency.

The commission gave the division until March 31, 2022 to submit a draft plan to distribute the $ 9 million, which S&P DJI agreed to pay without admitting or denying guilt.

In the meantime, the Fair Fund funds have been deposited into an interest-bearing account at the tax office of the US Department of the Treasury. Any interest will accrue to the benefit of the investors who receive the distribution, but at current rates which will not be much.


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