Investment Management Firm Settles Charge That It Failed to Disclose Conflict to Clients

The SEC announced that an investment management firm agreed to settle charges that include a breach of fiduciary duty, by failing to disclose a $50 million loan received by one of its senior executives from an advisory client.The SEC found that the firm categorized certain investments of an institutional advisory client inadvertently as managed assets when they were not, and charged the client approximately $6.5 million in asset management fees that it did not earn. Additionally, the order stated that the firm's compliance program was not reasonably designed to prevent violations of the federal securities laws.

See: SEC Press Release.
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