"covariance matrix SIGMA."
"SIGMA is a D-by-D symmetric positive semi-definite matrix"
"If the covariance matrix is diagonal, containing variances along the diagonal and zero covariances off the diagonal, SIGMA may also be specified as a 1-by-D matrix..."
So SIGMA is stated to be a covariance matrix in multiple places, or at least, a vector of variances. The diagonal elements of a covariance matrix are known to be VARIANCES, not standard deviations. That some people may often use the lower case greek letter sigma to indicate a standard deviation means you need to be careful. But a variable name like this means nothing out of context.