U.S. Securities and Exchange Commission
Litigation Release No. 21852 / February 11, 2011
Securities and Exchange Commission v. Neal R. Greenberg, Civ. Action No. 1:11-cv-00313-JLK (D. Colorado)
COURT ENTERS FINAL JUDGMENT AGAINST AGILE GROUP FOUNDER AND HEAD PORTFOLIO MANAGER NEAL R. GREENBERG
The U.S. Securities and Exchange Commission announced today that the United States District Court for the District of Colorado entered a Final Judgment, dated February10, 2011, in a civil action against Neal R. Greenberg, the former Chief Executive Officer and majority owner of registered investment adviser Tactical Allocation Services LLC (“TAS”) and the founder and head portfolio manager for a registered investment adviser wholly-owned by TAS, Agile Group LLC (“Agile Group”). Greenberg, without admitting or denying the Commission’s allegations, consented to the entry of a Final Judgment that enjoins him from violations of Sections 206(2) and 206(4) of the Investment Advisers Act of 1940 and Rules 206(4)-2, 206(4)-7, and 206(4)-8 thereunder; finds that he is liable for disgorgement of $3,941,185, plus prejudgment interest, but, based on Greenberg’s financial condition, waives payment of all but $330,000 of that amount and, in addition, requires Greenberg to surrender his interests in certain Agile Group hedge funds; imposes no penalty based on Greenberg’s financial condition; and prohibits Greenberg from seeking reimbursement for the money and fund interests he is disgorging and surrendering. Within 60 days, Greenberg is required to submit to the Court, for Court approval, a plan for equitable distribution of his relinquished interests for the benefit of Agile investors.
According to the SEC’s complaint in this matter, extensive losses were suffered by affiliated hedge funds managed and recommended by Greenberg, including the Agile Safety Fund (“Safety Fund”), the Agile Safety Fund International (“International Fund”), and the Agile Safety Variable Fund (“Variable Fund”) (collectively “Agile hedge funds”). The Agile hedge funds were marketed and managed by affiliated investment advisers Agile Group and TAS. The Commission’s complaint alleged that Greenberg negligently misrepresented the safety, suitability, and diversification of the Agile hedge funds to TAS clients, in many cases conservative investors in or near retirement. Further, the Complaint alleged that Greenberg made inadequate disclosure concerning advisory fees; failed to implement adequate compliance policies and procedures; failed to properly supervise his subordinate investment advisers; and failed to provide account statements and annual reports to his clients.