Naufal Sanaullah
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26227 / January 17, 2025
Securities and Exchange Commission v. Naufal Sanaullah, No. 2:25-cv-10165-FKB-KGA (E.D. Mich. filed Jan. 17, 2025)
SEC Charges Fund Executive with Making False Statements to Investors and Prospective Investors
On January 16, 2025, the Securities and Exchange Commission charged Ohio-resident Naufal Sanaullah, the former Chief Risk Officer and Chief Macro Strategist of EIA All Weather Alpha Fund I Partners, LLC (“EIA”), the investment adviser and general partner of EIA All Weather Alpha Fund I, L.P. (the “Fund”), with making and disseminating false and misleading statements to investors and prospective investors about the Fund’s risk management practices and his educational background. The SEC previously filed a complaint against EIA and its Chief Executive Officer, Andrew M. Middlebrooks, alleging that from at least mid-2017 to April 2022, EIA and Middlebrooks deceived investors in the Fund, including by making repeated false statements about the fund’s performance and total assets; misused new investor money to make Ponzi-like payments to other investors; and that Middlebrooks also misappropriated investor funds for personal use. SEC v. Middlebrooks, et. al., No. 2:22-cv-11073 (E.D. Mich. May 18, 2022). The May 2022 action is currently stayed.
The SEC’s complaint against Sanaullah, filed in the U.S. District Court for the Eastern District of Michigan, alleges that from at least December 2017 through October 2021, Sanaullah solicited new investors and encouraged current Fund investors to invest additional money while making and disseminating false and misleading statements. In support of these charges, the complaint further alleges that Sanaullah misrepresented to current and prospective investors the Fund’s risk management practices by claiming that the Fund had controls in place when it did not, and falsely describing his educational background by representing that he graduated from college though he did not.
The SEC’s complaint charges Sanaullah with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks permanent injunctive relief, disgorgement along with prejudgment interest, civil penalties, and an officer-and-director bar. Without admitting or denying the allegations in the SEC’s complaint, Sanaullah has consented to the entry of an order imposing injunctive relief and an officer-and-director bar, and authorizing the court to determine at a later date the amount of disgorgement, prejudgment interest, and civil penalties.
The SEC's investigation was conducted by Heather Marlow and supervised by Kimberly L. Frederick, both of the Asset Management Unit, and was further supervised by Nicholas P. Heinke and Jason J. Burt of the Denver Regional Office. Tracy Bowen of the Denver Regional Office also assisted with the investigation. The litigation will be led by Zachary Carlyle under the supervision of Gregory A. Kasper, Mr. Heinke, and Mr. Burt, all of the Denver Regional Office. The SEC appreciates the assistance of the FBI and U.S. Attorney’s Office for the Eastern District of Michigan.