Hedge Fund Manager Settles Charges and Reimburses Investors

An advisory firm and its Toronto-based hedge fund manager agreed to reimburse investors for losses in order to settle charges of making misleading claims about a fund's strategy and performance. According to the SEC Order, the firm's founder/manager (i) failed to disclose significant losses by combining actual and hypothetical returns when providing the fund's performance history, and (ii) made incomplete disclosures regarding deviation from the fund's strategy. The founder/manager agreed to pay a $75,000 penalty and to be barred from the securities industry.