AXA Rosenberg said it agreed to pay $217 million to cover investor losses as well as a $25 million civil penalty, in a settlement with the Securities and Exchange Commission regarding a coding error with its risk model.

The SEC charged three of the firm’s entities--AXA Rosenberg Group LLC (ARG), AXA Rosenberg Investment Management LLC (ARIM), and Barr Rosenberg Research Center LLC (BRRC)--with securities fraud for concealing a significant error in the computer code of the quantitative investment model that they use to manage client assets, the agency announced in a statement.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.