In the Matter of Securities America Advisors Admin. Proc. File No. 3-20150
Oct. 12, 2022
On November 13, 2020, the Commission instituted and simultaneously settled administrative and cease-and-desist proceedings (the “Order”) against Securities America Advisors, Inc. (“SAA” or the “Respondent”). In the Order, the Commission found that from January 1, 2016 through February 28, 2018 (“Relevant Period”), SAA failed to adopt and implement policies and procedures reasonably designed to prevent investments in two volatility-linked exchange-traded products (“ETPs”) that were not suitable for SAA clients. The Commission ordered the Respondent to pay $3,399.42 in disgorgement, $377.40 in prejudgment interest, and a $600,000 civil money penalty, for a total of $603,776.82, to the Commission. The Commission also created a Fair Fund, pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, so the penalty paid, along with the disgorgement and interest paid, can be distributed to harmed investors (the “Fair Fund”). See the Commission’s Order: Release No. IA-5627.
The Fair Fund includes the $603,776.82 paid by the Respondent. The Fair Fund has been deposited in an interest-bearing account at the U.S. Department of Treasury’s Bureau of the Fiscal Service, and any accrued interest will be added to the Fair Fund.
On May 21, 2021, the Commission issued an order appointing Miller Kaplan Arase LLP as the Tax Administrator of the Fair Fund. See the Commission’s Order: Release No. 34-91966.
On July 16, 2021, the Commission issued an order appointing Analytics Consulting LLC, as the Fund Administrator to oversee the administration and distribution of the Fair Fund and, set the administrator’s bond amount. See the Commission’s Order: Release No. 34-92426.
On January 3, 2022, the Commission published a notice of the proposed plan of distribution and opportunity for comment and simultaneously published the proposed plan of distribution (“Proposed Plan”). The notice provides the public with 30 days to submit their comments on the Proposed Plan. See the Commission’s Notice: Release No. 34-93892 and the Proposed Plan.
The Proposed Plan provides that the distribution of the Fair Fund shall be made to investors who purchased eligible securities during the relevant period and suffered a recognized loss as calculated by the methodology used in the Plan of Allocation in the Plan.
On March 3, 2022, the Commission issued an order approving the Proposed Plan and simultaneously posted the approved plan of distribution (the “Plan”). See the Commission’s Order: Release No. 34-94360 and the Plan.
On December 1, 2022, the Commission issued an order approving the disbursement of $415,204.48 from the Fair Fund for distribution to eligible investors. See the Commission’s Order: Release No. 34-96438.
For more information, please contact the Fund Administrator: