SEC fines Stamford investment firm $1.6M
The U.S. Securities and Exchange Commission (SEC) fined a Stamford investment firm $1.6 million for allegedly providing clients with false information, the agency announced Dec. 17.
According to the SEC, Aladdin Capital Holdings L.L.C. ran an advertisement stating that investors would be better off investing in Aladdin-sponsored loan and debt obligations because the company co-invested and had “skin in the game.”
However, the SEC alleges Aladdin did not co-invest with its clients as was advertised.
“If you sell an investment with the pitch that you are co-investing and have ‘skin in the game,’ then you better actually have ‘skin in the game,’” said Robert Khuzami, SEC Enforcement Division director, in a press release. “Such a representation by an investment adviser or broker-dealer is an important consideration to investors in complex products.”
Former Aladdin CFO Joseph Schlim agreed to pay a $50,000 fine for failing to take action to ensure the company’s marketing tactics were accurate.