On January 29, 2013, IMC Asset Management, Inc., an SEC-registered investment adviser, entered into an Offer of Settlement with the SEC after having been cited for violations of the Advisers Act. Specifically, the SEC fined the firm $30,000 for having failed to:(1) adopt and implement written policies and procedures reasonably designed to prevent violations of the Advisers Act; and (2) review at least annually its written policies and procedures and the effectiveness of their implementation.
From 2007 to 2010, IMC Asset Management had been operating its compliance program using a manual which had been drafted to address the business activity of its predecessor entity, a broker-dealer. The firm never updated its policies and procedures to address specific investment adviser compliance. Moreover, there was no evidence that the firm’s named CCO had implemented any portion of the RIA’s compliance program. IMC Asset Management had also failed to adequately address a series of noted deficiencies following a regulatory exam by the SEC. As a result, the firm was sanctioned $30,000 and issued a cease-and-desist order.
This appears to be a unique case as there were no allegations by the SEC of fraud against the RIA, and no evidence that any clients had been directly harmed as a result of the firm’s dysfunctional compliance program.
Link: SEC Order re IMC Asset Management