SEC Settles Fraud Charges Against Investment Bank Affiliates

The SEC settled charges alleging that affiliates of an investment bank "defrauded investors in two hedge funds by claiming they were safe, low-risk, and suitable for traditional bond investors." The SEC investigation found that the affiliates did not disclose the "dire condition of the funds." The SEC also found that many of the representations made by the investment bank's employees were "at odds with disclosures made in marketing documents and written materials provided to investors."

See: SEC Order Instituting Administrative and Cease-and-Desist Proceedings;SEC Press Release.