U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 22696 / May 3, 2013
Securities and Exchange Commission v. Grant Ivan Grieve, Finvest Asset Management, LLC, and Finvest Fund Management, LLC, Civil Action No. Civil Action No. 09-Civ-1198 (S.D.N.Y.) (AKH)
Court Orders Former Hedge Fund Manager Gad Grieve and Firm to Pay Over $26 Million in Disgorgement and Penalties
The Securities and Exchange Commission announced today that, on April 26, 2013, the Honorable Alvin K. Hellerstein, U.S. District Court Judge for the Southern District of New York, entered final judgments against former New York-based hedge fund manager Grant Ivan (Gad) Grieve and his Finvest advisory firms, ordering them to jointly and severally pay disgorgement of $14,164,780 and civil penalties in the amount of $12,192,302.
The final judgments stem from a civil injunctive action that the Commission filed on February 10, 2009. The SEC’s complaint alleged that defendants Grieve and Finvest fabricated and disseminated false financial information for their Finvest Primer hedge fund that was “certified” by a sham back-office administrator and phony auditing firm that Grieve himself created. The complaint also alleged that Grieve and Finvest provided current and prospective investors in the Finvest Primer and Finvest Yankee hedge funds with false monthly account statements, newsletters, and fact sheets that materially overstated the funds’ performance and assets. According to the Commission, beginning in late 2008, Grieve engaged in similar misconduct overseas, including luring new investors and placating existing investors with counterfeit documents.
The Commission charged Grieve and the Finvest firms with violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Section 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. On January 26, 2010, Judge Hellerstein entered a default judgment against Grieve, enjoining him from future violations of these provisions and ordering disgorgement and civil penalties with amounts to be determined in later proceedings. The Court entered similar judgments for monetary relief against the Finvest firms on April 23, 2010.
On July 29, 2010, following SEC administrative proceedings, Grieve was barred by default from association with any investment adviser.
For more information on earlier actions in this case, see Litigation Release No. 20893 (Feb. 10, 2009) [SEC Charges Hedge Fund Managers Grant Ivan Grieve, Finvest Asset Management, LLC, and Finvest Fund Management, LLC with Securities Fraud]; Litigation Release No. 21402 (Feb. 2, 2010) [Court Enters Default Judgment Against Hedge Fund Manager Grant Ivan Grieve]; Investment Advisers Act Release No. 3061 (July 29, 2010).