In 2 separate actions, the SEC came down very hard on private equity/hedge funds regarding both disclosure and operational issues.  See https://www.sec.gov/enforce/ia-5478-s; and  https://www.sec.gov/enforce/ia-5485-s.

In the first action, a firm settled for $1 million because it allegedly mischaracterized its prior investments in its marketing materials.  This purported misrepresentation led to an over-statement of the fund’s

Compliance personnel– especially, chief compliance officers– cannot ignore problems because, as one  SEC ALJ determined, it will lead to censure and fines for ignoring compliance obligations.  See    https://www.sec.gov/alj/aljdec/2020/id1400cff.pdf.

Apparently, for over 10 years, a registered investment advisor hired a series of unskilled CCOs, and ignored compliance and audit requirements.  The RIA tried to claim that

The SEC recently brought and settled an action against a former wannabe fund manager, who lied to prospective investors that he already had raised millions of dollars in the fund from other (fictitious) investors.  The fund manager was barred from the securities industry for 10 years.  See  https://www.sec.gov/litigation/litreleases/2020/lr24783.htm.

The SEC also claimed that the fund

Way back in 2017, the SEC obtained an emergency asset freeze against an internet-based ICO involving certain Canadian residents, who had raised over $15 million on a variety of social media sites through an alleged fraudulent scheme. http://www.sec.gov/litigation/complaints/2017/comp-pr2017-219.pdf.

At the time, it made major news and helped launch the SEC’s Cybersecurity Unit.  Of course, there 

Over the last several months, there has been an increase in questions from registered investment advisers relating to using hypothetical performance information.  Generally, the use of such information is fraught with danger as well as SEC scrutiny.  Not so long ago, the SEC went after a number of investment advisers and forced them to pay

A chief compliance officer (“CCO”) for a registered investment adviser (“RIA”) found himself barred from any compliance or supervisory role in the future because he willfully refused to fix a number of compliance issues.  See https://www.sec.gov/litigation/admin/2017/34-82397.pdf. 

The RIA had conducted a review that uncovered numerous compliance problems.  Despite having notice of the results of this

Today, the United States Supreme Court sent shock waves through the securities industry as well as the United States Securities and Exchange Commission’s (“SEC”) enforcement program when it held that SEC administrative law judges (“ALJ”) are “inferior officers,” and must be chosen pursuant to the appointments clause of the United States Constitution.  That is, the