SEC Charges Investment Adviser and Its Owner for Directing Unlawful Principal Trades
May 6, 2022
File No. 3-20843
May 6, 2022 - The Securities and Exchange Commission today announced settled charges against Perini Capital, LLC, a registered investment adviser based in Scottsdale, Arizona, and its owner, Michael D. Perini, for directing unlawful principal trades between advisory client accounts and accounts held by Perini.
The SEC's order finds that, from at least December 2016 through December 2020, Perini, on behalf of Perini Capital, directed thirty-three principal trades for a variety of reasons, including to provide liquidity for securities in Perini Capital's client accounts. However, according to the order, neither Perini Capital nor Perini provided written disclosure to, or obtained consent from, the affected clients concerning the principal nature of the resulting trades prior to the completion of such transactions.
As a result, the SEC's order finds that Perini Capital and Perini violated Section 206(3) of the Investment Advisers Act of 1940. Without admitting or denying the findings in the SEC's order, Perini Capital and Perini agreed to a cease-and-desist order, censures, and civil penalties of $115,000 and $35,000, respectively.
The SEC's investigation was conducted by Noel M. Franklin of the Denver Regional Office and supervised by Laura M. Metcalfe and Jason J. Burt.