Rye Investment Advisor, Charged by SEC with Conflict, Paying $150K Penalty
Rye investment advisor Apexium Financial LP has been charged by The Securities and Exchange Commission for failing to manage a conflict of interest. Apexium consented to a cease-and-desist order and a censure and agreed to pay a $150,000 penalty.
Last Thursday, September 28 the SEC announced settled charges against Apexium, based at 411 Theodore Fremd Avenue, Suite 206S. The address is a Regus shared office space that is home to several investment firms.
The settlement surrounds failing to manage a conflict of interest in a manner consistent with its representations in its firm brochures from 2018 through 2020, and for violations of rules relating to compliance policies and procedures.
According to the SEC’s order, Apexium disclosed that it had a financial conflict of interest when selecting an affiliated firm to manage certain clients’ assets and stated that Apexium would manage this conflict by documenting why it was in the client’s best interest to use the affiliated firm. However, Apexium did not document, as it stated in its firm brochures that it would, best interest determinations concerning the use of the affiliated firm.
The SEC’s order further finds that Apexium failed to adopt and implement written policies and procedures reasonably designed to ensure that it acted in accordance with the representations in its firm brochures, and also failed to conduct the required annual review of its compliance policies and procedures and the effectiveness of their implementation for 2018 and 2019.
The SEC’s order finds that, based on the foregoing, Apexium violated Sections 206(2) and 206(4) of the Advisers Act and Rule 206(4)-7 thereunder. Without admitting or denying the findings, Apexium consented to a cease-and-desist order and a censure and agreed to pay a $150,000 penalty.
The SEC’s investigation was conducted by Mariel Bronen and George N. Stepaniuk in the New York Regional Office, and was supervised by Tejal D. Shah. The examination that led to the investigation was conducted by Todd S. Naznitsky, Kristine Geissler, Anthony P. Fiduccia and Merryl Hoffman.
Read the SEC order.
