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The weekly news source for investment management legal and compliance professionals

News August 31, 2015 Issue

Accurate Small Print Disclosures Will Not Make Up for Misrepresentations

"Itís in the written materials" is not an adequate defense for firms whose representatives otherwise misinform clients about the risk level of investments. Advisers need to review all representations, written and oral, to ensure that they provide accurate and consistent disclosure. Two Citigroup affiliates learned this lesson on August 17, after they agreed to pay almost $180 million in disgorgement and interest to settle SEC charges that they defrauded investors in two hedge funds.

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