NEW YORK, Sept 19 (Reuters) - A Macquarie Group ( MCQEF )

investment adviser has agreed to pay $79.8 million to settle

charges in connection with overvaluing collateralized mortgage

obligations (CMO) held in advisory accounts, the U.S. Securities

and Exchange Commission said.

The regulator found that Macquarie Investment Management

Business Trust, which is a part of Macquarie Asset Management,

overvalued about 4,900 largely illiquid CMOs in 20 advisory

accounts, including 11 retail funds and also executed hundreds

of cross trades that favored certain clients over others.

From January 2017 through April 2021, the firm, which

managed a fixed-income investment strategy primarily focused on

mortgage-backed securities, CMOs and Treasury futures, assigned

the wrong prices to certain products and thus overstated the

performance of client accounts, the SEC said.

Regulators found Macquarie attempted to minimize losses to

redeeming investors by arranging cross trades with affiliated

accounts, rather than selling the overvalued products into the

market.

Macquarie Asset Management, which did not admit or deny the

SEC's findings, said in a statement it has already begun

remediation and is continuing the process, with the focus on

clients.

"Our business is built on the principles of integrity and

accountability," the statement said. "This legacy matter is not

consistent with how we do business."