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Another SEC Performance Advertising Case

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  • Baker, John
    Continuing its focus on advertising and promotion of investment adviser performance records, the SEC yesterday entered into consent orders with an investment
    Message 1 of 1 , Jun 1, 2000
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      Continuing its focus on advertising and promotion of investment
      adviser performance records, the SEC yesterday entered into consent orders
      with an investment adviser and two of its employees. The employees were the
      adviser's president and a more junior employee (possibly the president's
      son) who calculated the performance data. The performance figures contained
      a number of errors, and the adviser failed to disclose or inadequately
      disclosed that some of the figures were derived from the retroactive
      application of a model developed with the benefit of hindsight. The adviser
      distributed the false and misleading information in brochures, newsletters,
      written performance updates, oral presentations, Internet postings, and
      information submitted to the Money Manager Review ratings publication.

      The respondents consented to cease and desist orders and civil
      penalties aggregating $80,000. The adviser was also required to mail a copy
      of the SEC order covering the adviser and its president to its existing
      clients and to all prospective clients over the next 12 months. The orders,
      In re Schield Management Company, Advisers Act Release Nos. 1871 and 1872,
      are available online at the following locations:

      http://www.sec.gov/enforce/adminact/ia-1871.htm

      http://www.sec.gov/enforce/adminact/ia-1872.htm


      John M. Baker <JBaker@...>
      Stradley, Ronon, Stevens & Young, LLP
      1220 19th Street, N.W., Suite 700, Washington, DC 20036
      (202) 822-9611 Fax (202) 822-0140
      FundLaw Listowner Http://www.egroups.com/group/fundlaw
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