Hedge Fund Manager Agrees to Reimburse Investor Losses
The Securities and Exchange Commission today announced that a Manhattan-based investment advisory firm and its Toronto-based hedge fund manager have agreed to settle charges that they misled investors about a fund’s investment strategy and historical performance. They will reimburse investors $2.877 million in losses. According to the SEC’s order instituting a settled administrative proceeding, QED Benchmark Management LLC and its founder/fund manager Peter Kuperman avoided disclosing heavy trading losses to investors by using a misleading mixture of hypothetical and actual returns when providing the fund’s performance history. After obtaining millions of dollars from investors based on these misrepresentations, QED Benchmark…
Read MoreOcwen Paying Penalty for Misstated Financial Results
The Securities and Exchange Commission today announced that Ocwen Financial Corp. has agreed to settle charges that it misstated financial results by using a flawed, undisclosed methodology to value complex mortgage assets. Ocwen agreed to pay a $2 million penalty after an SEC investigation found that the company inaccurately disclosed to investors that it independently valued these assets at fair value under U.S. Generally Accepted Accounting Principles (GAAP). In fact, Ocwen merely used the valuation performed by a related party to which it sold the rights to service certain mortgages that remained a financing liability in Ocwen’s accounting. Ocwen’s audit…
Read MoreSusan Nash, Associate Director in Division of Investment Management, to Leave SEC After 26 Years of Service
The Securities and Exchange Commission today announced that Susan Nash, Associate Director in the Division of Investment Management, will leave the agency at the end of January. Ms. Nash has been a key architect of disclosure policy for mutual funds and other investment companies, and has led the division’s oversight of variable annuity and variable life insurance products. “Susan’s judgment, dedication, and commitment to excellence have substantially contributed to the Division of Investment Management,” said David Grim, Director of the Division of Investment Management. “In particular, Susan’s tireless work to enhance disclosure has significantly helped America’s investors.” Ms. Nash has…
Read MoreSEC: Alternative Fund Manager Overcharged Fees, Misled Investors
The Securities and Exchange Commission today announced that a Denver-based alternative fund manager has agreed to settle charges that the firm overcharged management fees and misled investors about how it valued certain assets. An SEC investigation found that Equinox Fund Management LLC calculated management fees contrary to the method described in registration statements for a managed futures fund called The Frontier Fund (TFF), and the firm also deviated from its disclosed valuation methodology for some TFF holdings. Equinox has agreed to refund investors approximately $5.4 million in excessive management fees collected during a seven-year period plus $600,000 in prejudgment interest. …
Read MoreSEC Awards Whistleblower More Than $700,000 for Detailed Analysis
The Securities and Exchange Commission today announced a whistleblower award of more than $700,000 to a company outsider who conducted a detailed analysis that led to a successful SEC enforcement action. “The voluntary submission of high-quality analysis by industry experts can be every bit as valuable as first-hand knowledge of wrongdoing by company insiders,” said Andrew Ceresney, Director of the SEC’s Enforcement Division. “We will continue to leverage all forms of information and analysis we receive from whistleblowers to help better detect and prosecute federal securities law violations.” Sean X. McKessy, Chief of the SEC’s Office of the Whistleblower, added,…
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