July 6, 2017-The Gazette has learned that the City of Gary and the Gary Sanitary District were subjects of a Cease and Desist Proceeding before the Securities and Exchange Commission (SEC) in August 2016. With regard to the City, the SEC found that a 2014 offering for municipal securities “failed to . . . provide certain types of disclosures within the time frames within the continuing disclosure agreement.” The Continuing Disclosure Agreement that the SEC refers to required that the City provide annual financial statements:
The SEC also found that the City failed to provide audited financial statements in a timely manner according to the public record document. (See the full documents below)
The SEC made very similar findings regarding the Gary Sanitary District (GSD). According to the findings of the SEC, the Gary Sanitary District issued municipal securities in 2011 and 2013. The SEC found that GSD had filed audited financial statements late for the years 2006 through 2010 and failed to disclose that information to potential investors.
The SEC found that the City of Gary and the Gary Sanitary District cooperated with the investigation and issued a sanction which is outlined below but which included establing written procedures and training, updating filings, and informing any future investors of the SEC Order. The remedial actions were to be completed by March 24, 2017. It is unknown if the City or the Sanitary District have complied. You can view both Orders below.
City of Gary Order Instituting Cease and Desist Procedures:
City of Gary Sanitary District Order Instituting Cease and Desist Procedures:
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