The Securities and Exchange Commission on Thursday charged a former BlackRock portfolio manager for failing to disclose a conflict of interest.
To settle the charges, Randy Robertson, a former managing director at BlackRock and a former co-portfolio manager for the BlackRock Multi-Sector Income Trust, or BIT, a closed-end management investment company, agreed to pay a $250,000 penalty. Without admitting or denying the SEC's findings, Mr. Robertson, who left BlackRock in February 2020, also agreed to a cease-and-desist order and a censure.
From 2015 to 2019, BIT invested in the aggregate of about $85 million in a secured lending facility to fund the print and advertising expenses associated with particular films that Aviron Group, a holding company, distributed, according to an SEC order.
Mr. Robertson had a significant role recommending and overseeing BIT's loans to the Aviron subsidiaries, the SEC said. But at the same time, Mr. Robertson asked Aviron's founder to help advance his daughter's acting career, which he did not disclose to BIT's board of trustees or BlackRock's compliance and legal teams.
Aviron, which had several subsidiaries engaged in the film distribution business, helped Mr. Robertson's daughter obtain a small role in a film produced in 2018, the SEC found.
"Investment professionals must be forthcoming about any conflicts of interest they may have with the companies in which they invest client funds, including situations involving favors or assistance to family members," said Andrew Dean, co-chief of the enforcement division's asset management unit, in a news release. "Investors must be able to know that the advice they receive is free of undisclosed conflicts, regardless of whether the conflict is financial in nature."
A BlackRock spokesman could not immediately be reached for comment.