SEC v. Schield Management Company; and Marshall L. Schield, No. LR-18865, District of Colorado (Sept. 2, 2004) — Press Release
raw: Schield Management Company and Marshall L. Schield
Schield Management Company and Marshall L. Schield, No. LR-18865 (Sept. 2, 2004)
Marshall L. Schield and Schield Management Company obstructed an SEC examination by destroying and altering required records—including emails, trading loss logs, and PINs—at Schield’s direction, and without admitting guilt, they consented to a permanent injunction and combined civil penalties of $175,000.
The U.S. Securities and Exchange Commission alleged that Marshall L. Schield, president of Schield Management Company, directed the destruction and alteration of records required under federal law, including emails, logs of client trading losses, and Personal Identification Numbers (PINs), to conceal misconduct during a regulatory examination. The company and Schield consented to a final judgment without admitting or denying the allegations, resulting in a permanent injunction against violating Section 204 of the Investment Advisers Act and Rule 204-2, which mandate proper recordkeeping and availability for SEC review. They were ordered to pay civil penalties of $75,000 and $100,000, respectively.
Marshall L. Schield, president of Schield Management Company, directed employees to destroy and alter documents required to be maintained under SEC regulations during a statutorily authorized examination, including e-mails, logs reflecting client trading losses, and Personal Identification Numbers (PINs) used in trading. The SEC alleged these actions were taken to conceal client losses and evade regulatory scrutiny, constituting violations of Section 204 of the Investment Advisers Act and Rule 204-2. Without admitting or denying the allegations, Schield and his company consented to a final judgment entered by the U.S. District Court for the District of Colorado on August 26, 2004. The judgment permanently enjoined them from failing to make or keep records as prescribed by the SEC or from refusing to make them available for examination. In addition to the injunction, Schield was ordered to pay a $75,000 civil penalty, and Schield Management Company was ordered to pay a $100,000 civil penalty, totaling $175,000 in fines. The case underscores the SEC’s enforcement focus on recordkeeping integrity and obstruction of regulatory oversight by investment advisers. The resolution highlights the legal consequences of tampering with documents during an active examination, even without allegations of underlying fraud.
Extracted insights
- $100K $100,000 $100K–$1M
- $75K $75,000 $10K–$100K
- agency Securities and Exchange Commission
- organization Securities and Exchange Commission
- court united states district court for the district of colorado
- organization United States District Court For The District Of Colorado
- Securities and Exchange Commission announced on August 26, 2004, the United States District Court for the District of Colorado entered a Final Judgment against Schield Management Company and Marshall L. Schield
- United States District Court for the District of Colorado entered a Final Judgment against Schield Management Company and Marshall L. Schield
- Securities and Exchange Commission alleged that at the direction of its president, Marshall L. Schield, Schield Management Company ...
- Securities and Exchange Commission sued Schield Management Company and Marshall L. Schield
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 18865 / September 2, 2004 Securities and Exchange Commission v. Schield Management Company and Marshall L. Schield, Civil Action No. 03-B-1332 (Dist. of Colo.) The Commission announced that on August 26, 2004, the United States District Court for the District of Colorado entered a Final Judgment against Schield Management Company and Marshall L. Schield. In its complaint, the Commission alleged that at the direction of its president, Marshall L. Schield, Schield Management Company, an investment adviser registered with the Commission, destroyed and altered documents it was required to produce during the course of a statutorily authorized Commission examination. The complaint also alleged that Marshall Schield directed Schield Management personnel to destroy e-mails, tamper with logs reflecting losses suffered by clients due to trading errors, and destroy Personal Identification Numbers (PINs) used in trading. Schield and Schield Management Company, without admitting or denying the allegations of the complaint, consented to the order which permanently enjoins and restrains them from failing to make and keep such records as the Commission by rule, has prescribed or failing to make all records available for examination by representatives of the Commission in violation of Section 204 of the Investment Advisers Act [15 U.S.C. § 80b-4] and Rule 204-2 thereunder [17 C.F.R. § 275.240-2]. Schield and Schield Management Company were also ordered to pay a civil money penalty in the amounts of $75,000 and $100,000 respectively.
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 18865 / September 2, 2004 Securities and Exchange Commission v. Schield Management Company and Marshall L. Schield, Civil Action No. 03-B-1332 (Dist. of Colo.) The Commission announced that on August 26, 2004, the United States District Court for the District of Colorado entered a Final Judgment against Schield Management Company and Marshall L. Schield. In its complaint, the Commission alleged that at the direction of its president, Marshall L. Schield, Schield Management Company, an investment adviser registered with the Commission, destroyed and altered documents it was required to produce during the course of a statutorily authorized Commission examination. The complaint also alleged that Marshall Schield directed Schield Management personnel to destroy e-mails, tamper with logs reflecting losses suffered by clients due to trading errors, and destroy Personal Identification Numbers (PINs) used in trading. Schield and Schield Management Company, without admitting or denying the allegations of the complaint, consented to the order which permanently enjoins and restrains them from failing to make and keep such records as the Commission by rule, has prescribed or failing to make all records available for examination by representatives of the Commission in violation of Section 204 of the Investment Advisers Act [15 U.S.C. § 80b-4] and Rule 204-2 thereunder [17 C.F.R. § 275.240-2]. Schield and Schield Management Company were also ordered to pay a civil money penalty in the amounts of $75,000 and $100,000 respectively.