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August 10, 2015

Posted  January 28, 2016

Guggenheim Partners Investment Management LLC, a subsidiary of global financial services firm Guggenheim Partners LLC, has agreed to pay a $20 million penalty to settle charges by the SEC.  The SEC’s order found that Guggenheim breached its fiduciary duties by failing to disclose a $50 million loan that one of its senior executives received from an advisory client.  Guggenheim failed to disclose the loan, or the potential conflict of interest created by the executive’s receipt of it, to other clients involved in the transactions.  In addition, the SEC’s order found that Guggenheim inadvertently categorized certain investments as managed assets, leading to a client being inappropriately charged approximately $6.5 million in asset management fees.  Despite identifying the error, Guggenheim did not return the fees for almost two years.  Finally, the SEC’s order found Guggenheim’s compliance program was not reasonably designed to prevent violations of the federal securities laws and that the company failed to enforce its code of ethics.  SEC

Tagged in: Regulatory Violations, Securities Fraud,