In the Matter of Gemini Fund Services, LLC
Admin. Proc. File No. 3-18348
On January 22, 2018, the Commission instituted and simultaneously settled cease-and-desist proceedings (the “Order”) against Gemini Fund Services, LLC (“Gemini”), the fund administrator for a Massachusetts based investment company called the GL Beyond Income Fund (the "GL Fund"). Gemini was responsible for calculating the GL Fund's daily share price (also called a "net asset value" or "NAV") and transmitting it to the investing public, via the NASDAQ securities exchange. In the Order, the Commission found from February 2013 to December 2014, the NAV that Gemini gave to NASDAQ was inflated because Gemini included in the NAV fake assets that were purportedly worth over $15 million but were actually worth nothing.
The Commission ordered, and Gemini has paid, a total of $561,406.00 in disgorgement, prejudgment interest, and a civil money penalty to the Commission. The Commission also created a Fair Fund, pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, as amended, so the penalty, along with the disgorgement and prejudgment interest, collected can be distributed to those harmed by Gemini’s conduct described in the Order (the “Fair Fund”). See the Commission’s Order: Release No. IA-4847.
On April 19, 2018, the Commission issued an order directing the disbursement of the Fair Fund to the GL Fund for distribution to affected investors as detailed therein and ordering any residual funds after the payment of taxes to the U.S. Treasury. See the Commission’s Order: Release No. 34-83069.
Also on April 19, 2018, the Commission issued an order appointing Miller Kaplan Arase LLP as the Tax Administrator for the Fair Fund. See the Commission’s Order: Release No. 34-83070.
For more information, please contact the Commission:
Office of Distributions