The SEC announced the resolution of charges against five registered investment advisors for violations of the Marketing Rule.
The companies, GeaSphere, Bradesco Global Advisors, Credicorp Capital Advisors, InSight Securities, Monex Asset Managementhave agreed to resolve the SEC charges and pay penalties ranging from $20,000 to $100,000.
The SEC’s investigations found that the companies advertised hypothetical returns to the general public on their websites without adopting and implementing policies and procedures reasonably designed to ensure that the hypothetical returns were relevant to the financial condition and likely investment objectives of the intended audience. of each advertisement, as required by the marketing standard, says the statement from the supervisory body.
However, Bradesco, Credicorp, InSight and Monex “they received reduced sanctions due to the corrective actions they took before being contacted by SEC staff.” These four firms agreed to pay civil penalties of between $20,000 and $30,000, which reflected certain corrective actions taken by each of these companies before being contacted by Commission staff.
GeaSphere, for its part, “also violated other regulatory requirements, such as making false and misleading statements in advertisements, advertising misleading performance of models, failing to demonstrate the performance shown in its advertisements, and failing to sign written agreements with people to whom compensated for its recommendations,” adds the SEC statement. The firm must pay a civil fine of $100,000.
Besides, GeaSphere “committed recordkeeping and regulatory compliance violations and made misleading statements about its performance to a client of a registered investment company and that the misleading statements were included in the client’s prospectus filed with the Commission.”
“Without admitting or denying the SEC’s findings, all of the firms consented to be found to have violated the Investment Advisers Act of 1940 and to be ordered to be censured, to cease and desist from violating the charged provisions, and to comply with certain undertakings.” , highlights the statement.
This is the second set of cases the Commission has brought as part of an ongoing selective sweep regarding Marketing Rule violations after charging nine advisory firms in September 2023.
