Aletheia Research & Management and its two founders will pay $400,000 in fines and the manager will keep an independent consultant hired to improve its record-keeping policies and practices in a settlement the company reached with the SEC over misleading RFP disclosures and other compliance violations.
In an administrative proceeding earlier this month, the SEC said co-founder Roger B. Peikin, who was Aletheia chief compliance officer and CFO until 2010, failed to disclose in 10 RFP questionnaires between 2005 and 2008 that the firm had received an SEC deficiency letter in 2005; he also allowed internal compliance weaknesses to continue, the SEC said. Mr. Peikin, who was suspended by the firm in July 2010, must pay $100,000. Peter J. Eichler Jr. Aletheia's co-founder, chairman, CEO, chief investment officer and largest shareholder, must also pay $100,000.
The firm will pay an additional $200,000 in fines, and retain the independent consultant hired during the investigation to improve record keeping and ensure the accuracy of RFP disclosures, according to the settlement document. Under the terms of the settlement, the principals neither admit nor deny the agency findings.
The last SEC action involving RFP information was 2006 against Capital Works Investment Partners.
Aletheia has more than $7.5 billion in assets under management, according to a spokesman. He said the firm's AUM has been “moderately increasing over the last several quarters” as a result of improvements made in “personnel, processes and infrastructure.” He added that clients “are well-informed of the historical issues in the SEC order and the steps taken to address them, and the firm has not lost any clients as a result” of the settlement. “Aletheia's clients have been very supportive,” he said.