{"id":47639,"date":"2015-04-22T07:43:38","date_gmt":"2015-04-22T11:43:38","guid":{"rendered":"http:\/\/www.hedgeco.net\/news\/?p=47639"},"modified":"2015-04-22T07:43:38","modified_gmt":"2015-04-22T11:43:38","slug":"hedge-fund-advisor-blackrock-settles-with-sec-for-12-million","status":"publish","type":"post","link":"https:\/\/hedgeco.net\/news\/04\/2015\/hedge-fund-advisor-blackrock-settles-with-sec-for-12-million.html","title":{"rendered":"Hedge Fund Advisor BlackRock Settles With SEC For $12 Million"},"content":{"rendered":"

\"conflictos-de-intereses-02\"<\/a>New York (HedgeCo.Net) – BlackRock Advisors LLC has agreed to settle SEC charges of failing to disclose a conflict of interest among its ranks and will pay a $12 million penalty. The hedge fund advisor will also hire an independent compliance consultant to conduct an internal review.<\/p>\n

BlackRock reported $70.4 billion of long-term net inflows for the first quarter of 2015, representing 6.5% annualized growth.<\/p>\n

“Daniel J. Rice III was managing energy-focused funds and separately managed accounts at BlackRock when he founded Rice Energy, a family-owned and operated oil-and-natural gas company.” The SEC said. “Rice was the general partner of Rice Energy and personally invested approximately $50 million in the company. Rice Energy later formed a joint venture with a publicly-traded coal company that eventually became the largest holding (almost 10 percent) in the $1.7 billion BlackRock Energy & Resources Portfolio, the largest Rice-managed fund. The SEC\u2019s order finds that BlackRock knew and approved of Rice\u2019s investment and involvement with Rice Energy as well as the joint venture, but failed to disclose this conflict of interest to either the boards of the BlackRock registered funds or its advisory clients.”<\/p>\n

The SEC\u2019s order also finds that BlackRock and its then-chief compliance officer Bartholomew A. Battista caused the funds\u2019 failure to report a \u201cmaterial compliance matter\u201d \u2013 namely Rice\u2019s violations of BlackRock\u2019s private investment policy \u2013 to their boards of directors. BlackRock additionally failed to adopt and implement policies and procedures for outside activities of employees, and Battista caused this failure. Battista agreed to pay a $60,000 penalty to settle the charges against him.<\/p>\n

“BlackRock violated its fiduciary obligation to eliminate the conflict of interest created by Rice\u2019s outside business activity or otherwise disclose it to BlackRock\u2019s fund boards and advisory clients,” said Andrew J. Ceresney, Director of the SEC\u2019s Division of Enforcement. “By failing to make such a disclosure, BlackRock deprived its clients of their right to exercise their independent judgment to determine whether the conflict might impact portfolio management decisions.”<\/p>\n

Alex Akesson
\nEditor for HedgeCo.net<\/a>
\nalex@hedgeco.net<\/a>
\nHedgeCo.Net<\/a> is a premier hedge fund database<\/a> and community for qualified and accredited investors only. Membership in HedgeCo.net<\/a> is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds<\/a>!<\/p>\n","protected":false},"excerpt":{"rendered":"

New York (HedgeCo.Net) – BlackRock Advisors LLC has agreed to settle SEC charges of failing to disclose a conflict of interest among its ranks and will pay a $12 million penalty. The hedge fund advisor will also hire an independent […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11,3],"tags":[],"class_list":["post-47639","post","type-post","status-publish","format-standard","hentry","category-hedge-fund-fraud","category-hedgeco-news"],"_links":{"self":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/47639","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/comments?post=47639"}],"version-history":[{"count":2,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/47639\/revisions"}],"predecessor-version":[{"id":47642,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/47639\/revisions\/47642"}],"wp:attachment":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/media?parent=47639"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/categories?post=47639"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/tags?post=47639"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}