Hedge Fund Manager Barred After Failing to Show Remorse
The SEC barred from the industry a convicted hedge fund sponsor in part because he failed to respond to the SEC so that he could show remorse.
Following a wire fraud conviction for misrepresentations and diversion of assets, the SEC instituted proceedings to determine whether the defendant should be barred from the industry. The defendant, representing himself pro se, failed to answer the OIP, respond to SEC motions, and respond to the order to show cause. The SEC imposed an industry bar because the defendant did not use the proceedings as an opportunity to assure the SEC that he would not commit future crimes or that he recognized the wrongful nature of his conduct. The SEC barred the defendant because he posed a continuing threat to the investors.
I’m not arguing that the SEC would not have barred the defendant had he shown up, expressed remorse, and asked for mercy. But, he left the SEC no other choice when he ignored all the pleadings and deadlines. Sticking your head in the sand and hoping it goes away is never the right course of action during SEC proceedings.
Read SEC Opinion here.