OCIE issued a Risk Alert

On November 9, 2020, the Office of Compliance, Inspections and Examinations (OCIE) issued a Risk Alert in connection with observations from OCIE’s examinations of investment advisers: supervision, compliance and multiple branch offices. OCIE conducted a series of examinations that focused on SEC-registered investment advisers operating from numerous branch offices and with operations geographically dispersed from … Read More

Capitol Securities Management, Inc. Settles Charges

On November 5, 2020, Capitol Securities Management, Inc. settled charges in connection with its mutual fund share class selection practices and its receipt of fees pursuant to Rule 12b-1 under the Investment Company Act of 1940 (“12b-1 fees”). At times during the period from January 1, 2014 through December 31, 2016 (the “Relevant Period”), CSM … Read More

Conrad Coggeshall Settles Charges

On November 5, 2020, Conrad Coggeshall settled charges that he defrauded elderly investors in a company he called BOTR, LLC. According to the complaint, Coggeshall made multiple misrepresentations to investors, including that they were investing in BOTR, LLC, a successful mergers and acquisition firm based in New York, their investments were safe and insured, and … Read More

SEC’s Division of Enforcement Published 2020 Annual Report

On November 2, 2020, the SEC’s Division of Enforcement published its annual report for fiscal year 2020.  In fiscal year 2020, the SEC brought a diverse mix of 715 enforcement actions, including 405 “standalone actions”.   72% of standalone actions included charges against one or more individuals.  Over 20% of all enforcement actions were against investment … Read More

October 2020 SEC Updates

On November 2, 2020, the SEC’s Division of Enforcement published its annual report for fiscal year 2020.  In fiscal year 2020, the SEC brought a diverse mix of 715 enforcement actions, including 405 “standalone actions”.   72% of standalone actions included charges against one or more individuals.  Over 20% of all enforcement actions were against investment advisers representing … Read More

September 2020 SEC Updates

On September 30, 2020, Morgan Stanley & Co. LLC agreed to settle charges against for violations of Regulation SHO, the regulatory framework governing short sales.  Morgan Stanley hedged synthetic exposure to swaps by purchasing or selling the securities referenced in the swaps, and it separated its hedges into two aggregation units – one holding only long positions, … Read More

August 2020 SEC Updates

On August 27, 2020, Aldo Marchena was barred from association with an investment adviser and broker-dealer.  In connection with that plea, Aldo Marchena admitted that between October 2016 and January 2017, he stole more than $1 million from a client. To conceal this fraud, Marchena created and provided to his client fake account statements that purported to show the … Read More

SETTLEMENT FOR BIRINYI ASSOCIATES

On July 31, 2020, Birinyi Associates settled a enforcement action for allocating profitable day trades in a manner that was unfair to certain clients and inconsistent with the firm’s disclosures and internal policies. [https://www.sec.gov/litigation/admin/2020/ia-5555.pdf] … Read More

PONZI SCHEME EXPOSED

On July 30, 2020, the SEC charges former Georgia State Legislator with defrauding investors in a Ponzi scheme.  [https://www.sec.gov/news/press-release/2020-168] … Read More

NEW EERT ESTABLISHED AS QUICK RESPONSE TEAM

On July 28, 2020, the SEC announced the creation of the Event and Emerging Risks Examination Team (EERT) in the Office of Compliance Inspections and Examinations (OCIE). The EERT will proactively engage with financial firms about emerging threats and current market events and quickly mobilize to provide expertise and resources to the SEC’s regional offices when critical matters arise. Working with … Read More