After FINRA began its investigation, VMC self-reported three additional errors that affected the presentation of performance information on account statements:

When VMC customers deposited a paper or electronic check into an account on the last business day of the month, the personal performance section of the account statement incorrectly identified the deposit as an increase in market value instead of a cash deposit. The error would be corrected on the next month's statement as a decrease in market value in the same amount, but it resulted in the investment return calculation being inaccurate on about 23,000 statements.
VMC's account statements also inaccurately showed margin credits and debits such as paying down margin debt or purchasing a security on margin as market appreciation or depreciation where customers maintained an open position over multiple months. Although this error was corrected when the position closed, it caused the investment return calculator to be inaccurate on about 57,000 statements.
For approximately 50 corporate actions such as stock splits, VMC account statements inaccurately reported differences in the value of shares before and after the corporate action as a purchase or withdrawal instead of market appreciation or depreciation, which also caused the Investment Return line to be inaccurate. This error affected an unknown number of statements.

Related: FINRA, the SEC and Congress aim to safeguard senior investors

The errors did not affect the actual market yield paid to customers, which was correct, or holdings information displayed on customer statements.

Instant Insights /

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