(Adds Wedbush comment, paragraphs 5-7)
By Sarah N. Lynch
WASHINGTON, Nov 20 (Reuters) - Brokerage firm Wedbush Securities will pay a $2.44 million penalty and admit to wrongdoing to settle civil charges over shoddy risk controls that let thousands of overseas traders gain access to U.S. markets, federal regulators said.
Wedbush's settlement with the U.S. Securities and Exchange Commission on Thursday was widely anticipated after the settlement talks were disclosed in September in a filing in the SEC's administrative court.
The SEC also said that former Wedbush Executive Vice President Jeffrey Bell and Senior Vice President Christina Fillhart also agreed to settle the charges, which alleged they had caused the violations.
Bell and Fillhart agreed to pay a total of more than $85,000 in penalties, ill-gotten gains and interest, without admitting or denying the charges.
In a statement, Wedbush said it was "satisfied" with the resolution of the case, and that the firm has a "strong record" of supporting effective regulation.
It said the case involved trading activity by certain former "correspondent firms and clients" between 2011 and early 2013.
"Wedbush Securities terminated the accounts at issue more than a year ago," the company said, noting that no one incurred any losses.
Wedbush in June became the second brokerage firm to be charged with violations of a fairly new SEC rule known as market access. Those rules require brokerages that provide customers with direct access to the market to have reasonable controls in place.
The market access rule is one of a handful of measures the SEC put into place after the May 6, 2010, "flash crash" in which a computer algorithm's trading activity helped spark a major market plunge.
"Wedbush acknowledges that it granted access to thousands of overseas traders without having appropriate safeguards in place," said Andrew Ceresney, director of the SEC's Enforcement Division.
The brokerage, which is one of the largest by trading volume on the Nasdaq Stock Exchange, also was charged in August by the Financial Industry Regulatory Authority in connection with similar allegations of market access rule violations.
The status of FINRA's related case against Wedbush was not immediately clear.
The firm's founder and president, Edward William Wedbush, is fighting a separate case against him by FINRA. In 2012, FINRA imposed a 31-day suspension on him for not adequately supervising the company's regulatory filings. FINRA also fined him personally $25,000 and the firm $300,000.
An appeal in that matter is pending. (Reporting by Sarah N. Lynch; Additional reporting by Suzanne Barlyn in New York; Editing by Bill Trott and Dan Grebler)