Forbes – Donald Brownstein’s hedge fund firm has agreed to pay a $300,000 penalty to settle a Securities & Exchange Commission enforcement action that claimed the firm failed to adequately try to prevent conflicts of interest regarding investments in its various funds, potentially leading to improper trade allocations.
The SEC claims that Brownstein’s Stamford, Ct., hedge fund firm, Structured Portfolio Management, allowed one of its traders to trade the same securities across three of the firm’s advised hedge funds between February 2006 and February 2009, making it possible for the trader to engage in improper allocations of U.S. Treasuries among the funds. According to the SEC’s administrative order, there were internal concerns at Structured Portfolio Management over the situation but the hedge fund firm failed to implement reasonable policies designed to stop improper trade allocations.
