ADMINISTRATIVE PROCEEDING
FILE NO. 3-19964

September 4, 2020 - The Securities and Exchange Commission today announced settled charges against New York City-based investment advisory firm SQN Capital Management Group, LLC for violating Commission rules designed to protect advisory clients from the misuse or misappropriation of their assets.

Registered investment advisers that have custody of client assets are subject to the "custody rule," which requires the advisers to undergo an annual surprise examination to verify the existence of assets or, where permissible, to distribute to investors, within 120 days of each fiscal year's end, annual audited financial statements for the fund prepared in accordance with Generally Accepted Accounting Principles (GAAP). According to the SEC's order, SQN Capital failed to timely distribute the required annual audited financial statements for each year from 2012 through 2019 for one private fund that it advised, and for each year from 2014 through 2019 for another private fund that it advised, thereby repeatedly violating the custody rule. In addition, SQN Capital failed to adopt and implement written policies and procedures reasonably designed to prevent custody rule violations.

The SEC's order finds that SQN Capital violated Section 206(4) of the Investment Advisers Act of 1940 and Rules 206(4)-2 and 206(4)-7 thereunder. Without admitting or denying the order's findings, SQN Capital consented to a cease-and-desist order and a censure, and agreed to pay a civil penalty of $75,000.

The SEC's investigation was conducted by Christopher M. Castano and George N. Stepaniuk in the New York Regional Office, and supervised by Sanjay Wadhwa. The examination that led to the investigation was conducted by Kevin Rush, Azam Riaz, Lisa Blackburn, and Raymond Slezak.