Friday, September 14, 2007
On September 14, the SEC settled administrative proceedings as to David Byck, William Cole, Charles Irwin, Michael Price, and Jay Sumner (Respondents). In 2002-2003, Respondents operated two registered investment advisers, and entities that purported to be third-party administrators. The order finds that Respondents enabled their hedge fund clients to place mutual fund orders after 4:00 p.m. ET, but receive the net asset valuation determined as of 4:00 p.m. Specifically, the order finds that, between August 2002 and February 2003, Respondents conducted their late trading via their registered investment advisers through a broker-dealer. The order further finds that between March and April 2003, utilizing sham third-party administrators, Respondents submitted orders on behalf of their hedge funds clients to National Securities Clearing Corporation to purchase and sell mutual funds as late as 3:00 a.m. ET, while obtaining the prior day's 4:00 p.m. NAV. IN THE MATTER OF DAVID BYCK, WILLIAM COLE, CHARLES IRWIN, MICHAEL PRICE, AND JAY SUMNER.