SEC Cracks Down on Widespread Reporting Failures and Delays

October 2, 2024

SEC Cracks Down on Widespread Reporting Failures and Delays

In two different statements, the SEC announced enforcement actions against various companies and individuals for failure to report—or late reports—on various forms, including Schedules 13D, 13G, Forms 3, 4, 5, Form 13H, and Forms 13F.

Failure to Report Certain Securities Holdings

On September 17, 2024, the SEC announced charges against 11 institutional investment managers for failing to file Forms 13F. Two of the entities, Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A. (Nationale-Nederlanden) and NEPC, LLC, were also charged with failing to file Forms 13H as required for large traders who trade a significant amount of exchange-listed securities.

The institutional investment managers charged and their respective penalties are:

• Ashton Thomas Private Wealth, LLC – $375,000
• Azzad Asset Management, Inc. – $225,000
• Bulltick Wealth Management, LLC – $175,000
• Dixon Mitchell Investment Counsel, Inc. – no financial penalty
• Financial Synergies Wealth Advisors, Inc. – $225,000
• Focus Financial Network, Inc. – $475,000
• Mason Investment Advisory Services, Inc. – $525,000
• Nationale-Nederlanden – no financial penalty
• NEPC, LLC – $725,000
• TD Private Client Wealth, LLC – $475,000
• Traphagen Investment Advisors, LLC – $225,000

$3.8 Million in Penalties of Late Beneficial Ownership and Insider Transaction Reports

On September 25, 2024, the SEC announced it settled charges against 23 entities and individuals for failures to timely report information about their holdings and transactions in public company stock. Two public companies were also charged for contributing to filing failures. The charges focus on Schedules 13D and 13G reports and Forms 3, 4, and 5. SEC staff used data analytics to identify the charged individuals and entities as filing required reports late.

The firms charged in connection with beneficial ownership of publicly traded companies and their respective penalties are:

• Sunbeam Management, LLC – $40,000;
• TALANTA Investment Group, LLC – $45,000;
• Grays Peak Ventures LLC – $65,000;
• Stilwell Value LLC – $75,000;
• BSC, LP – $75,000;
• Bain Capital Credit Member, LLC – $130,000;
• FIG LLC, which conducts business under the name Fortress Investment Group – $200,000;
• Adage Capital Management, L.P. – $200,000;
• Essex Woodlands Management, Inc. – $225,000;
• The Goldman Sachs Group, Inc. – $300,000;
• Oaktree Capital Management, L.P. – $375,000;
• The Bank of Nova Scotia – $375,000; and
• Alphabet Inc. – $750,000.

Alphabet was also charged with failing to timely file Form 13F, reports institutional money managers are required to file regarding certain sizeable securities holdings.

For more information about our 13F services, click here. For more information related to the SEC’s final rule on Beneficial Ownership reporting, click here.