April 9, 2018
SEC Charges Investment Adviser for “Improperly” Registering and Violating Multiple Rules
WHAT HAPPENED?
On April 5th, 2018 the Securities and Exchange Commission (SEC) charged an Investment adviser for improperly registering and violating several commission rules.
According to the SEC, the principle, sole owner of an investment firm falsely claimed more than $100 million in assets under management (AUM) from 2012 through 2016 to meet the minimum eligibility requirement for SEC registration. The owner of the firm also made violations to the custody rule by failing to provide quarterly statements to clients and by failing to organize an annual surprise audit of assets. Lastly, the owner of the firm failed to “make, keep, and make available” certain books and records required by the SEC.
The owner of the firm has agreed to pay $20,000 in settlement charges and will be suspended from the industry for 12 months.
WHAT DOES THIS MEAN FOR ME?
Fairview recommends practicing adequate recordkeeping to support any claims made to the SEC. Reporting false information to the SEC can lead to public enforcement action.
If you have any questions or concerns about how this proceeding relates to you or your firm, please reach out to Fairview.
Sources: https://www.sec.gov/litigation/admin/2018/ia-4875.pdf
