In re J.P. Morgan Investment

 
 
 UNITED STATES OF AMERICA 
 Before the 
 SECURITIES AND EXCHANGE COMMISSION 
 
INVESTMENT COMPANY ACT OF 1940 
Release No. 35373 / October 31, 2024 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-22281 
 
In the Matter of 
 
J.P. Morgan Investment  
                 Management Inc., 
 
Respondent. 
 
 
 
ORDER INSTITUTING CEASE-AND-
DESIST PROCEEDINGS, PURSUANT TO 
SECTION 9(f) OF THE INVESTMENT 
COMPANY ACT OF 1940, MAKING 
FINDINGS, AND IMPOSING A CEASE-
AND-DESIST ORDER  
   
I. 
 The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-
and-desist proceedings be, and hereby are, instituted pursuant to Section 9(f) of the Investment 
Company Act of 1940 (“Investment Company Act”) against J.P. Morgan Investment Management 
Inc. (“JP Morgan IM” or “Respondent”).   
II. 
 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (the “Offer”) which the Commission has determined to accept. Solely for the purpose 
of these proceedings and any other proceedings brought by or on behalf of the Commission, or to 
which the Commission is a party, and without admitting or denying the findings herein, except as 
to the Commission’s jurisdiction over it and the subject matter of these proceedings, which are 
admitted, Respondent consents to the entry of this Order Instituting Cease-and-Desist Proceedings, 
Pursuant to Section 9(f) of the Investment Company Act of 1940, Making Findings, and Imposing 
a Cease-and-Desist Order (“Order”), as set forth below. 
III. 
 On the basis of this Order and Respondent’s Offer, the Commission finds
1
 that  
                                                 
1
  The findings herein are made pursuant to Respondent’s Offer of Settlement and are 
not binding on any other person or entity in this or any other proceeding.  

 
 
 
2 
Summary 
1. In March 2020, JP Morgan IM, a registered investment adviser to three U.S. money 
market mutual funds (“Domestic Funds”) and the delegated portfolio manager of an affiliated 
foreign money market fund (“Foreign Fund”), caused prohibited joint transactions involving these 
funds that advantaged the Foreign Fund over the Domestic Funds.   
2. At the onset of the COVID-19 pandemic, the Federal Reserve Board (“Fed”) 
established a liquidity facility to address severe liquidity constraints in the market called the Money 
Market Mutual Fund Liquidity Facility (“MMLF”).  The MMLF was available only for certain 
qualifying U.S. funds and assets.  While the Domestic Funds had access to the MMLF, the Foreign 
Fund and many of its assets were not eligible for the program.  Between March 2 and March 23, 
2020, significant investor redemptions resulted in a decrease in the assets of the Domestic Funds 
and the Foreign Fund by 25% and 21%, respectively.  In anticipation of possible additional 
redemptions and to avoid the need to charge investors a fee for redeeming shares (“liquidity fees”) 
or limiting or halting redemptions altogether (“gates”), and to slow or discourage redemptions in the 
Foreign Fund, JP Morgan IM structured transactions involving the Domestic Funds to provide the 
Foreign Fund with liquidity from the MMLF.  In those transactions, the Foreign Fund sold a total of 
approximately $4.3 billion in assets over the course of two days, on March 24 and 25, 2020, that 
were ineligible for the MMLF to Investment Bank A, an entity that was not affiliated with either JP 
Morgan IM, the Domestic Funds, or the Foreign Fund.  Each day, Investment Bank A repackaged 
these assets as collateral for asset-backed commercial paper (“Repack ABCP”) and then 
immediately sold the entire issuance to the Domestic Funds through Broker-Dealer A, an 
unaffiliated entity.  The Domestic Funds then sold these securities to Broker-Dealer B, a separate 
unaffiliated entity, which immediately pledged them to the MMLF.     
3. While the Foreign Fund recognized a net realized gain of $1.5 million and received 
$4.3 billion in sales proceeds from the transactions that enhanced its liquidity, the Domestic Funds 
earned one-tenth of this amount and bore certain associated risks.  Those risks included the chance 
that the Fed might reject the Repack ABCP for placement into the MMLF due to the transaction 
structure, which could have affected the Domestic Funds’ liquidity position, and the risk that a 
regulator (like the Commission) could determine these were joint transactions that violated Section 
17(d) of the Investment Company Act and Rule 17d-1 thereunder.  These provisions prohibit any 
affiliate of a registered investment company, or an affiliate of the affiliated entity, from acting as 
principal to effect a transaction in which the registered investment company participates unless it 
first obtains an exemption from the Commission permitting the joint transaction—an exemption that 
JP Morgan IM neither sought nor obtained here.     
4. As a result of the conduct described herein, JP Morgan IM caused violations of 
Section 17(d) of the Investment Company Act and Rule 17d-1 thereunder. 

 
 
 
3 
Respondent 
5. JP Morgan IM, incorporated in Delaware, has been an investment adviser 
registered with the Commission since 1984.  JP Morgan IM’s principal place of business is in New 
York, New York.  JP Morgan IM has regulatory assets under management of $2.5 trillion as of 
December 31, 2023.  Among other things, JP Morgan IM provides advisory services to registered 
investment companies that operate as U.S. money market mutual funds (including the Domestic 
Funds) and to foreign money market funds (including the Foreign Fund).  JP Morgan IM is a wholly 
owned subsidiary of JPMorgan Chase & Co., a global financial services firm incorporated in 
Delaware and headquartered in New York, New York.  
Other Relevant Entities 
6. The Domestic Funds comprise three funds that are each a series of separate trusts.  
Each of these trusts is registered as an open-end management investment company under the 
Investment Company Act, and each of the Domestic Funds operates as a money market fund in 
accordance with Rule 2a-7 under the Investment Company Act.  JP Morgan IM is an investment 
adviser to the Domestic Funds.  The Domestic Funds had net assets of $138.1 billion as of 
December 11, 2023.  
7. The Foreign Fund is a sub-fund of a money market fund organized as a Société 
d’Investissement à Capital Variable domiciled in Luxembourg.  The Foreign Fund operates as a 
money market fund available to investors outside of the United States.  The manager of the Foreign 
Fund has delegated portfolio management responsibilities to JP Morgan IM.  The Foreign Fund 
had net assets of $125.6 billion as of December 11, 2023.  
The Domestic Funds, the Foreign Fund, and Stressed Market Conditions 
8. JP Morgan IM advises several U.S. registered and foreign money market funds, 
which utilize different investment strategies.  The Domestic Funds’ prospectuses in effect as of 
March 2020 stated that the Domestic Funds would invest in, among other things, short-term debt 
securities, debt securities issued or guaranteed by U.S. and foreign banks, asset-backed securities, 
and high-quality commercial paper.  Commercial paper are unsecured promissory notes issued by 
companies that typically pay a fixed rate of interest.  As of March 2, 2020, the Domestic Funds had 
combined net asset values of $75.6 billion. 
9. In addition to the Domestic Funds, JP Morgan IM was a delegated portfolio 
manager to an affiliated Luxembourg-domiciled money market fund, the Foreign Fund, for which 
JP Morgan IM invested in similar securities as the Domestic Funds.  Investment in the Foreign 
Fund was available to foreign investors.  As of March 2, 2020, the Foreign Fund had a net asset 
value of $85.1 billion.   
10. In March 2020, the onset of the COVID-19 pandemic resulted in highly stressed 
market conditions for commercial paper, debt securities issued by banks, and asset-backed 
securities, particularly for those securities with maturities greater than seven days.   

 
 
 
4 
11. These stressed market conditions impacted the Domestic Funds and the Foreign 
Fund as well as many other money market funds that invested in similar securities.  Specifically, 
investor redemptions in the Domestic Funds and the Foreign Fund were significant and outstripped 
subscriptions.  From March 2 to March 23, 2020, the Domestic Funds’ assets decreased 25%, 
falling from $75.6 billion to $56.5 billion.  During the same period, the Foreign Fund’s assets 
decreased 21%, falling from $85.1 billion to $66.9 billion.  This redemption activity caused JP 
Morgan IM to seek liquidity in these funds.  But, due to market conditions at the time, these funds 
risked incurring investment losses if they sold their holdings—particularly longer-dated securities 
that matured in seven days or later—in order to satisfy these redemptions. 
12. Rule 2a-7 of the Investment Company Act places certain liquidity requirements on 
domestic registered money market funds such as the Domestic Funds.  Specifically, Rule 2a-
7(d)(4)(iii), as in effect at the time, required that a registered money market fund (like the 
Domestic Funds) hold 30% or more of its portfolio in “weekly liquid assets” before it acquires 
securities that do not meet the definition of such assets.
2
  Rule 2a-7(a)(28) described, and currently 
describes, various eligible assets meeting the definition of “weekly liquid assets,” which include 
government obligations with a maturity of 60 days or less.  However, commercial paper, debt 
securities issued by banks, and asset-backed securities would not fall within the definition of 
weekly liquid assets unless they matured within five business days.   
13. In addition, pursuant to the provisions of Rule 2a-7 in effect at the time, the board 
overseeing a money market fund registered under the Investment Company Act could, under these 
circumstances, impose liquidity fees and gates, which have the effect of slowing and discouraging 
redemptions.  The board of trustees of the Domestic Funds could take such actions if the Domestic 
Funds’ weekly liquid assets dropped below the 30% threshold. 
14. Accordingly, if the Domestic Funds had sold shorter duration securities, which 
were not experiencing the same level of market stress, to satisfy these redemptions while 
continuing to hold longer-duration securities, the Domestic Funds risked the imposition of liquidity 
fees and gates due to the impact that such securities sales would have had on the Domestic Funds’ 
weekly liquid assets.  
Fed Intervention and the MMLF 
15. On March 18, 2020, the Fed created a liquidity facility, the MMLF, to assist in 
providing liquidity to so-called “2a-7 funds”—such as the Domestic Funds but not the Foreign 
Fund—because “many money markets” became “extremely illiquid due to uncertainty related to 
                                                 
2
  The Commission amended Rule 2a-7 on July 12, 2023, effective October 2, 2023. See 
Money Market Reforms; Form PF Reporting Requirements for Large Liquidity Fund Advisers; 
Technical Amendments to Form N-CSR and Form N-1A, Investment Company Rel. No. 34959 
(July 12, 2023). 
 

 
 
 
5 
the coronavirus outbreak.”
3
  The MMLF permitted eligible borrowers, which included all U.S. 
depository institutions, U.S. bank holding companies, including parent companies incorporated in 
the United States or their U.S. broker-dealer subsidiaries, or U.S. branches and agencies of foreign 
banks, to pledge certain assets purchased from 2a-7 funds into the facility at the assets’ amortized 
cost.  In exchange for the pledged assets, the MMLF would provide eligible borrowers with non-
recourse cash advances equal to either amortized cost or fair value of the pledged assets provided 
the MMLF eligibility requirements were met.  These cash advances were the “liquidity” provided 
by the MMLF, which could be used to satisfy investor redemptions. 
16. The MMLF had two central eligibility requirements.  First, the MMLF could only 
purchase assets from U.S. registered money market funds; not foreign money market funds.  
Second, the MMLF had certain requirements concerning the eligibility of assets that 2a-7 funds 
could pledge to the facility.  Specifically, with respect to commercial paper, the MMLF required 
that the issuer of commercial paper be domiciled in the U.S. in order for the commercial paper to 
be eligible to be pledged.  The MMLF had the same requirements for debt securities issued by 
banks.   
17. The Foreign Fund was not eligible to participate in the MMLF because it was not a 
2a-7 fund and many of the securities in the Foreign Fund portfolio were not eligible to be pledged 
to the MMLF because they were not issued by U.S. entities.  Foreign financial regulators, such as 
the European Central Bank, did not have a program similar to the MMLF to provide liquidity to 
foreign money market funds.   
The Domestic Funds Seek Liquidity from the MMLF as Market Conditions Deteriorate  
18. Once the MMLF became operational, the Domestic Funds began to participate in 
the program to obtain additional liquidity.  On March 19, 2020, JP Morgan IM sold $390 million in 
eligible assets from several 2a-7 funds it advised, including the Domestic Funds, to an MMLF-
eligible borrower.  On the following two trading days, March 20 and 23, 2020, these sales 
exceeded $1 billion each day.  The Domestic Funds were among the JP Morgan IM-advised 2a-7 
funds that sold assets to the MMLF-eligible borrowers on these days. 
19. On March 20 and 23, 2020, the Foreign Fund experienced heightened redemption 
activity, with its net assets dropping 6%.   
JP Morgan IM Uses a Set of Transactions to Provide the Foreign Fund Access to the MMLF 
20. Executives at JP Morgan IM recognized that, under the terms of the MMLF, the 
Foreign Fund could not access the MMLF and began efforts to persuade the Fed to expand the 
program.   
                                                 
3
  See Federal Reserve Board, Money Market Mutual Fund Liquidity Facility FAQs, 
available at https://www.federalreserve.gov/monetarypolicy/files/mmlf-faqs.pdf. 

 
 
 
6 
21. But, recognizing that these efforts to persuade the Fed to expand the MMLF to 
include foreign money market funds were unlikely to succeed, JP Morgan IM’s Global Liquidity 
Group (“Global Liquidity”), which comprised the investment professionals responsible for 
advising the Domestic Funds and the Foreign Fund, structured transactions to provide the Foreign 
Fund with liquidity through the MMLF.  JP Morgan IM would execute joint transactions involving 
the Foreign Fund and the Domestic Funds, working with Investment Bank A, Broker-Dealer A, 
and Broker-Dealer B to complete the transactions.  Discussions about the transactions among 
Global Liquidity, others at JP Morgan IM, and Investment Bank A began on March 20, 2020. 
22. Overlapping members of Global Liquidity represented both the Domestic Funds 
and the Foreign Fund in the transactions, working with Investment Bank A and Broker-Dealer B 
that pledged the Repack ABCP to the MMLF.  Additionally, two individuals who were co-
portfolio managers of the Foreign Fund were also co-portfolio managers of the two largest 
Domestic Funds and one of those individuals was a co-portfolio manager for all three Domestic 
Funds and the Foreign Fund. 
23. On March 23, 2020, in coordination with JP Morgan IM, personnel at J.P. Morgan 
Securities LLC (“JP Morgan Securities”) emailed the Fed seeking guidance on whether a 
hypothetical transaction would comply with the intent of the MMLF.  The hypothetical transaction 
posed to the Fed was similar to what later became the Repack ABCP trades.  In the following days, 
the Fed and JP Morgan Securities engaged in further communications about the hypothetical 
transaction.  The Fed ultimately responded that it did not plan to issue any guidance that would 
prevent the hypothetical transaction, but it was not asked to and did not opine on whether the 
transaction would comply with the federal securities laws. 
24. On March 24 and 25, 2020, JP Morgan IM executed the Repack ABCP trades.  In 
total, the Foreign Fund received $4.3 billion in proceeds from asset sales to an affiliated broker-
dealer of Investment Bank A.  As of March 25, 2020, these proceeds represented approximately 
7% of the value of the assets in the Foreign Fund’s portfolio.   
25. The proceeds the Foreign Fund received from the transactions were in excess of the 
amortized cost of the assets it sold to Investment Bank A.  As a result, the Foreign Fund accrued 
$1.5 million in net realized gains from the two transactions. 
26. Investment Bank A used the Foreign Fund securities as collateral for the Repack 
ABCP it issued and then sold to the Domestic Funds.  Because the Foreign Fund’s securities had 
differing maturities, the Repack ABCP also had differing maturities.  The Repack ABCP was not 
sold to the Domestic Funds at the Foreign Fund’s amortized cost or even at the cost at which 
Investment Bank A acquired the Foreign Fund securities.  Instead, the price the Domestic Funds 
paid for the Repack ABCP was set by JP Morgan IM—above amortized cost—so that the 
transactions could fund the Foreign Fund’s $1.5 million in net realized gains, a $1.2 million 
structuring fee paid to Investment Bank A, as well as other transaction costs. 

 
 
 
7 
27. The Domestic Funds bought all $4.3 billion of the Repack ABCP over the course of 
March 24 and 25, 2020, from Broker-Dealer A, which distributed the securities.  On each trading 
day, the Domestic Funds held the Repack ABCP for one day before selling the holdings to Broker-
Dealer B, an MMLF-eligible borrower, at their amortized cost.  There were approximately 
$610,000 in transaction-based fees (mark-ups and mark-downs) from the broker-dealers that 
executed the purchases from Investment Bank A and the sales related to the MMLF pledges. 
28. The Domestic Funds earned approximately $150,000 in interest income by holding 
the Repack ABCP overnight due to its pre-determined 1.3% annualized yield.  This yield was five 
basis points above the minimum yield required by the Fed for assets to qualify for the MMLF.
4
  
The Domestic Funds earned only one-tenth of the investment gain that the Foreign Fund made 
from the transactions.  Because JP Morgan IM personnel were involved in all aspects of the 
transactions, JP Morgan IM could have allocated more of the investment proceeds from the 
transactions to the Domestic Funds by increasing the annualized yield of the Repack ABCP but did 
not do so.  Broker-Dealer B received five basis points in compensation for pledging the securities 
to the MMLF. 
29. The Repack ABCP had longer duration maturities that extended well beyond a 
single day and into April and May 2020.  Internal daily market surveys created by Global Liquidity 
on March 24 and 25, 2020, stated that the range of yields for asset-backed commercial paper with 
similar one- and two-month maturities were between 1.25% and 2.50%, placing the 1.3% yield JP 
Morgan IM set for the Repack ABCP at the low end of this range. 
30. With the exception of the Repack ABCP purchases, on March 24 and 25, 2020, the 
Domestic Funds primarily acquired fixed income securities with overnight maturities and, in 
limited instances, securities that matured on April 1, 2020.  No other securities the Domestic Funds 
acquired on those days had one- or two-month maturities like the Repack ABCP.     
31. Because the money the Domestic Funds obtained from Broker-Dealer B in 
exchange for their pledges of the Repack ABCP was used to pay for those same securities, these 
transactions did not enhance the Domestic Funds’ liquidity position.  Conversely, the Foreign Fund 
received $4.3 billion in sales proceeds that enhanced its liquidity, which included the $1.5 million 
net realized gain.  
32. JP Morgan IM was aware that the Domestic Funds bore certain risks in the 
transactions that the Foreign Fund did not bear.  For example, certain risks were discussed in a 
                                                 
4
  The term sheet for the MMLF stated that the Fed would provide advances of 1% above 
the primary credit rate available to depository institutions, which was 0.25% during this time. 
See  Federal Reserve Board, Money Market Mutual Fund Liquidity Facility, available at 
https://www.federalreserve.gov/newsevents/pressreleases/files/ monetary20201130a2.pdf; 
Federal Reserve Board,  Implementation Note Issued March 15, 2020, available at 
https://www.federalreserve.gov/newsevents/pressreleases/ monetary20200315a1.htm. 
  

 
 
 
8 
memo describing these transactions that was reviewed by the Domestic Funds’ counsel and 
distributed by JP Morgan IM to certain Domestic Funds’ trustees and counsel to the independent 
trustees of the board on March 25, 2020.  The memo stated that JP Morgan IM believed that the 
transactions were in the Domestic Funds’ “best interest”; it also discussed risks that the MMLF 
may cease operating or that the Fed “may reject” the Repack ABCP for “placement into the 
MMLF.”  Under either scenario, the transactions would have had the effect of reducing the 
Domestic Funds’ liquidity positions during a period of time when there were stressed market 
conditions and significant redemption activity in the Domestic Funds.  As of March 25, 2020, the 
Repack ABCP would have constituted 7.7% of the combined assets of the Domestic Funds if the 
MMLF had rejected the Repack ABCP.  Furthermore, because these securities had varying 
maturities extending to as late as May 2020, there was a possibility that the Domestic Funds would 
have had to hold these assets until maturity because it was unlikely that they could sell them in 
stressed market conditions without incurring a loss.  As discussed above, holding these securities 
until their maturity could have reduced the weekly liquid asset levels of the Domestic Funds to 
below 30% of net assets, which could have adversely affected their operations as discussed in 
Paragraphs 13 and 14.  The memo also stated that there was a risk that the Commission would 
view these transactions as joint transactions that violated Section 17(d) of Investment Company 
Act and Rule 17d-1.   
33. After March 25, 2020, the Domestic Funds did not purchase any additional Repack 
ABCP.  In fact, the Domestic Funds did not participate again in MMLF-related transactions until 
April 7 and 9, 2020, when they sold $613 million of other securities to MMLF-eligible borrowers 
that were not structured by JP Morgan IM like the Repack ABCP.  In contrast to the Repack 
ABCP, the Domestic Funds held these securities for between five days and several months prior to 
having them pledged to the MMLF and did not use the proceeds of these sales to enhance the 
liquidity of the Foreign Fund. 
Violations 
34. Section 17(d) of the Investment Company Act prohibits any affiliated person of a 
registered investment company or any affiliated person of such affiliated person (each, an 
“affiliated person”), acting as principal, from effecting any transaction in which such registered 
investment company is a joint or a joint and several participant with an affiliated person in 
contravention of such rules and regulations as the Commission may prescribe.  Section 17(d) is 
intended to limit or prevent participation by such registered company on a basis different from or 
less advantageous than that of another participant.  Rule 17d-1 promulgated under the Investment 
Company Act prohibits any affiliated person from participating in any joint enterprise, other joint 
arrangement, or profit-sharing plan (a “joint arrangement”) unless it obtains an order from the 
Commission permitting the joint arrangement.   
35. As contemplated and executed, the Repack ABCP transactions were joint 
transactions under Section 17(d) and Rule 17d-1.  Accordingly, JP Morgan IM caused violations of 
Section 17(d) of the Investment Company Act and Rule 17d-1 promulgated thereunder by causing 
the Foreign Fund and the Domestic Funds to engage in the Repack ABCP transactions. 

 
 
 
9 
IV. 
 In view of the foregoing, the Commission deems it appropriate to impose the sanctions 
agreed to in Respondent JP Morgan IM’s Offer. 
 Accordingly, it is hereby ORDERED that: 
 A. Pursuant to Section 9(f) of the Investment Company Act, Respondent JP Morgan IM 
cease and desist from committing or causing any violations and any future violations of Section 
17(d) of the Investment Company Act of 1940 and Rule 17d-1 promulgated thereunder. 
B. Pursuant to Section 9(d) of the Investment Company Act, JP Morgan IM shall, 
within twenty-one days of the entry of this Order, pay a civil money penalty in the amount of 
$5,000,000 to the Securities and Exchange Commission for transfer to the general fund of the 
United States Treasury, subject to Exchange Act Section 21F(g)(3).  If timely payment is not 
made, additional interest shall accrue pursuant to 31 U.S.C. § 3717.   
Payment must be made in one of the following ways:   
(1) Respondent may transmit payment electronically to the Commission, which 
will provide detailed ACH transfer/Fedwire instructions upon request;  
(2) Respondent may make direct payment from a bank account via Pay.gov 
through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  
(3) Respondent may pay by certified check, bank cashier’s check, or United 
States postal money order, made payable to the Securities and Exchange 
Commission and hand-delivered or mailed to:  
Enterprise Services Center 
Accounts Receivable Branch 
HQ Bldg., Room 181, AMZ-341 
6500 South MacArthur Boulevard 
Oklahoma City, OK 73169 
Payments by check or money order must be accompanied by a cover letter identifying JP 
Morgan IM as a Respondent in these proceedings, and the file number of these proceedings; a copy 
of the cover letter and check or money order must be sent to Lee A. Greenwood, Assistant 
Regional Director, Asset Management Unit, Division of Enforcement, Securities and Exchange 
Commission, 100 Pearl Street, Suite 20-100, New York, NY 10004.   
 C. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 
treated as penalties paid to the government for all purposes, including all tax purposes.  To 
preserve the deterrent effect of the civil penalty, Respondent agrees that in any Related Investor 
Action, it shall not argue that it is entitled to, nor shall it benefit by, offset or reduction of any 

 
 
 
10 
award of compensatory damages by the amount of any part of Respondent’s payment of a civil 
penalty in this action (“Penalty Offset”).  If the court in any Related Investor Action grants such a 
Penalty Offset, Respondent agrees that it shall, within 30 days after entry of a final order granting 
the Penalty Offset, notify the Commission's counsel in this action and pay the amount of the 
Penalty Offset to the Securities and Exchange Commission.  Such a payment shall not be deemed 
an additional civil penalty and shall not be deemed to change the amount of the civil penalty 
imposed in this proceeding.  For purposes of this paragraph, a “Related Investor Action” means a 
private damages action brought against Respondent by or on behalf of one or more investors based 
on substantially the same facts as alleged in the Order instituted by the Commission in this 
proceeding. 
 By the Commission. 
 
 
Vanessa A. Countryman 
        Secretary 

UNITED STATES OF AMERICA 

 Before the 

 SECURITIES AND EXCHANGE COMMISSION 

 

INVESTMENT COMPANY ACT OF 1940 

Release No. 35373 / October 31, 2024 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-22281 

 

In the Matter of 

 

J.P. Morgan Investment  

                 Management Inc., 

 

Respondent. 

 

 

 

ORDER INSTITUTING CEASE-AND-

DESIST PROCEEDINGS, PURSUANT TO 

SECTION 9(f) OF THE INVESTMENT 

COMPANY ACT OF 1940, MAKING 

FINDINGS, AND IMPOSING A CEASE-

AND-DESIST ORDER  

   

I. 

 The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-

and-desist proceedings be, and hereby are, instituted pursuant to Section 9(f) of the Investment 

Company Act of 1940 (“Investment Company Act”) against J.P. Morgan Investment Management 

Inc. (“JP Morgan IM” or “Respondent”).   

II. 

 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 

of Settlement (the “Offer”) which the Commission has determined to accept. Solely for the purpose 

of these proceedings and any other proceedings brought by or on behalf of the Commission, or to 

which the Commission is a party, and without admitting or denying the findings herein, except as 

to the Commission’s jurisdiction over it and the subject matter of these proceedings, which are 

admitted, Respondent consents to the entry of this Order Instituting Cease-and-Desist Proceedings, 

Pursuant to Section 9(f) of the Investment Company Act of 1940, Making Findings, and Imposing 

a Cease-and-Desist Order (“Order”), as set forth below. 

III. 

 On the basis of this Order and Respondent’s Offer, the Commission finds1 that  

                                                 

1  The findings herein are made pursuant to Respondent’s Offer of Settlement and are 

not binding on any other person or entity in this or any other proceeding.  



 

 

 
2 

Summary 

1. In March 2020, JP Morgan IM, a registered investment adviser to three U.S. money 

market mutual funds (“Domestic Funds”) and the delegated portfolio manager of an affiliated 

foreign money market fund (“Foreign Fund”), caused prohibited joint transactions involving these 

funds that advantaged the Foreign Fund over the Domestic Funds.   

2. At the onset of the COVID-19 pandemic, the Federal Reserve Board (“Fed”) 

established a liquidity facility to address severe liquidity constraints in the market called the Money 

Market Mutual Fund Liquidity Facility (“MMLF”).  The MMLF was available only for certain 

qualifying U.S. funds and assets.  While the Domestic Funds had access to the MMLF, the Foreign 

Fund and many of its assets were not eligible for the program.  Between March 2 and March 23, 

2020, significant investor redemptions resulted in a decrease in the assets of the Domestic Funds 

and the Foreign Fund by 25% and 21%, respectively.  In anticipation of possible additional 

redemptions and to avoid the need to charge investors a fee for redeeming shares (“liquidity fees”) 

or limiting or halting redemptions altogether (“gates”), and to slow or discourage redemptions in the 

Foreign Fund, JP Morgan IM structured transactions involving the Domestic Funds to provide the 

Foreign Fund with liquidity from the MMLF.  In those transactions, the Foreign Fund sold a total of 

approximately $4.3 billion in assets over the course of two days, on March 24 and 25, 2020, that 

were ineligible for the MMLF to Investment Bank A, an entity that was not affiliated with either JP 

Morgan IM, the Domestic Funds, or the Foreign Fund.  Each day, Investment Bank A repackaged 

these assets as collateral for asset-backed commercial paper (“Repack ABCP”) and then 

immediately sold the entire issuance to the Domestic Funds through Broker-Dealer A, an 

unaffiliated entity.  The Domestic Funds then sold these securities to Broker-Dealer B, a separate 

unaffiliated entity, which immediately pledged them to the MMLF.     

3. While the Foreign Fund recognized a net realized gain of $1.5 million and received 

$4.3 billion in sales proceeds from the transactions that enhanced its liquidity, the Domestic Funds 

earned one-tenth of this amount and bore certain associated risks.  Those risks included the chance 

that the Fed might reject the Repack ABCP for placement into the MMLF due to the transaction 

structure, which could have affected the Domestic Funds’ liquidity position, and the risk that a 

regulator (like the Commission) could determine these were joint transactions that violated Section 

17(d) of the Investment Company Act and Rule 17d-1 thereunder.  These provisions prohibit any 

affiliate of a registered investment company, or an affiliate of the affiliated entity, from acting as 

principal to effect a transaction in which the registered investment company participates unless it 

first obtains an exemption from the Commission permitting the joint transaction—an exemption that 

JP Morgan IM neither sought nor obtained here.     

4. As a result of the conduct described herein, JP Morgan IM caused violations of 

Section 17(d) of the Investment Company Act and Rule 17d-1 thereunder. 



 

 

 
3 

Respondent 

5. JP Morgan IM, incorporated in Delaware, has been an investment adviser 

registered with the Commission since 1984.  JP Morgan IM’s principal place of business is in New 

York, New York.  JP Morgan IM has regulatory assets under management of $2.5 trillion as of 

December 31, 2023.  Among other things, JP Morgan IM provides advisory services to registered 

investment companies that operate as U.S. money market mutual funds (including the Domestic 

Funds) and to foreign money market funds (including the Foreign Fund).  JP Morgan IM is a wholly 

owned subsidiary of JPMorgan Chase & Co., a global financial services firm incorporated in 

Delaware and headquartered in New York, New York.  

Other Relevant Entities 

6. The Domestic Funds comprise three funds that are each a series of separate trusts.  

Each of these trusts is registered as an open-end management investment company under the 

Investment Company Act, and each of the Domestic Funds operates as a money market fund in 

accordance with Rule 2a-7 under the Investment Company Act.  JP Morgan IM is an investment 

adviser to the Domestic Funds.  The Domestic Funds had net assets of $138.1 billion as of 

December 11, 2023.  

7. The Foreign Fund is a sub-fund of a money market fund organized as a Société 

d’Investissement à Capital Variable domiciled in Luxembourg.  The Foreign Fund operates as a 

money market fund available to investors outside of the United States.  The manager of the Foreign 

Fund has delegated portfolio management responsibilities to JP Morgan IM.  The Foreign Fund 

had net assets of $125.6 billion as of December 11, 2023.  

The Domestic Funds, the Foreign Fund, and Stressed Market Conditions 

8. JP Morgan IM advises several U.S. registered and foreign money market funds, 

which utilize different investment strategies.  The Domestic Funds’ prospectuses in effect as of 

March 2020 stated that the Domestic Funds would invest in, among other things, short-term debt 

securities, debt securities issued or guaranteed by U.S. and foreign banks, asset-backed securities, 

and high-quality commercial paper.  Commercial paper are unsecured promissory notes issued by 

companies that typically pay a fixed rate of interest.  As of March 2, 2020, the Domestic Funds had 

combined net asset values of $75.6 billion. 

9. In addition to the Domestic Funds, JP Morgan IM was a delegated portfolio 

manager to an affiliated Luxembourg-domiciled money market fund, the Foreign Fund, for which 

JP Morgan IM invested in similar securities as the Domestic Funds.  Investment in the Foreign 

Fund was available to foreign investors.  As of March 2, 2020, the Foreign Fund had a net asset 

value of $85.1 billion.   

10. In March 2020, the onset of the COVID-19 pandemic resulted in highly stressed 

market conditions for commercial paper, debt securities issued by banks, and asset-backed 

securities, particularly for those securities with maturities greater than seven days.   



 

 

 
4 

11. These stressed market conditions impacted the Domestic Funds and the Foreign 

Fund as well as many other money market funds that invested in similar securities.  Specifically, 

investor redemptions in the Domestic Funds and the Foreign Fund were significant and outstripped 

subscriptions.  From March 2 to March 23, 2020, the Domestic Funds’ assets decreased 25%, 

falling from $75.6 billion to $56.5 billion.  During the same period, the Foreign Fund’s assets 

decreased 21%, falling from $85.1 billion to $66.9 billion.  This redemption activity caused JP 

Morgan IM to seek liquidity in these funds.  But, due to market conditions at the time, these funds 

risked incurring investment losses if they sold their holdings—particularly longer-dated securities 

that matured in seven days or later—in order to satisfy these redemptions. 

12. Rule 2a-7 of the Investment Company Act places certain liquidity requirements on 

domestic registered money market funds such as the Domestic Funds.  Specifically, Rule 2a-

7(d)(4)(iii), as in effect at the time, required that a registered money market fund (like the 

Domestic Funds) hold 30% or more of its portfolio in “weekly liquid assets” before it acquires 

securities that do not meet the definition of such assets.2  Rule 2a-7(a)(28) described, and currently 

describes, various eligible assets meeting the definition of “weekly liquid assets,” which include 

government obligations with a maturity of 60 days or less.  However, commercial paper, debt 

securities issued by banks, and asset-backed securities would not fall within the definition of 

weekly liquid assets unless they matured within five business days.   

13. In addition, pursuant to the provisions of Rule 2a-7 in effect at the time, the board 

overseeing a money market fund registered under the Investment Company Act could, under these 

circumstances, impose liquidity fees and gates, which have the effect of slowing and discouraging 

redemptions.  The board of trustees of the Domestic Funds could take such actions if the Domestic 

Funds’ weekly liquid assets dropped below the 30% threshold. 

14. Accordingly, if the Domestic Funds had sold shorter duration securities, which 

were not experiencing the same level of market stress, to satisfy these redemptions while 

continuing to hold longer-duration securities, the Domestic Funds risked the imposition of liquidity 

fees and gates due to the impact that such securities sales would have had on the Domestic Funds’ 

weekly liquid assets.  

Fed Intervention and the MMLF 

15. On March 18, 2020, the Fed created a liquidity facility, the MMLF, to assist in 

providing liquidity to so-called “2a-7 funds”—such as the Domestic Funds but not the Foreign 

Fund—because “many money markets” became “extremely illiquid due to uncertainty related to 

                                                 
2  The Commission amended Rule 2a-7 on July 12, 2023, effective October 2, 2023. See 

Money Market Reforms; Form PF Reporting Requirements for Large Liquidity Fund Advisers; 

Technical Amendments to Form N-CSR and Form N-1A, Investment Company Rel. No. 34959 

(July 12, 2023). 

 



 

 

 
5 

the coronavirus outbreak.”3  The MMLF permitted eligible borrowers, which included all U.S. 

depository institutions, U.S. bank holding companies, including parent companies incorporated in 

the United States or their U.S. broker-dealer subsidiaries, or U.S. branches and agencies of foreign 

banks, to pledge certain assets purchased from 2a-7 funds into the facility at the assets’ amortized 

cost.  In exchange for the pledged assets, the MMLF would provide eligible borrowers with non-

recourse cash advances equal to either amortized cost or fair value of the pledged assets provided 

the MMLF eligibility requirements were met.  These cash advances were the “liquidity” provided 

by the MMLF, which could be used to satisfy investor redemptions. 

16. The MMLF had two central eligibility requirements.  First, the MMLF could only 

purchase assets from U.S. registered money market funds; not foreign money market funds.  

Second, the MMLF had certain requirements concerning the eligibility of assets that 2a-7 funds 

could pledge to the facility.  Specifically, with respect to commercial paper, the MMLF required 

that the issuer of commercial paper be domiciled in the U.S. in order for the commercial paper to 

be eligible to be pledged.  The MMLF had the same requirements for debt securities issued by 

banks.   

17. The Foreign Fund was not eligible to participate in the MMLF because it was not a 

2a-7 fund and many of the securities in the Foreign Fund portfolio were not eligible to be pledged 

to the MMLF because they were not issued by U.S. entities.  Foreign financial regulators, such as 

the European Central Bank, did not have a program similar to the MMLF to provide liquidity to 

foreign money market funds.   

The Domestic Funds Seek Liquidity from the MMLF as Market Conditions Deteriorate  

18. Once the MMLF became operational, the Domestic Funds began to participate in 

the program to obtain additional liquidity.  On March 19, 2020, JP Morgan IM sold $390 million in 

eligible assets from several 2a-7 funds it advised, including the Domestic Funds, to an MMLF-

eligible borrower.  On the following two trading days, March 20 and 23, 2020, these sales 

exceeded $1 billion each day.  The Domestic Funds were among the JP Morgan IM-advised 2a-7 

funds that sold assets to the MMLF-eligible borrowers on these days. 

19. On March 20 and 23, 2020, the Foreign Fund experienced heightened redemption 

activity, with its net assets dropping 6%.   

JP Morgan IM Uses a Set of Transactions to Provide the Foreign Fund Access to the MMLF 

20. Executives at JP Morgan IM recognized that, under the terms of the MMLF, the 

Foreign Fund could not access the MMLF and began efforts to persuade the Fed to expand the 

program.   

                                                 
3  See Federal Reserve Board, Money Market Mutual Fund Liquidity Facility FAQs, 

available at https://www.federalreserve.gov/monetarypolicy/files/mmlf-faqs.pdf. 



 

 

 
6 

21. But, recognizing that these efforts to persuade the Fed to expand the MMLF to 

include foreign money market funds were unlikely to succeed, JP Morgan IM’s Global Liquidity 

Group (“Global Liquidity”), which comprised the investment professionals responsible for 

advising the Domestic Funds and the Foreign Fund, structured transactions to provide the Foreign 

Fund with liquidity through the MMLF.  JP Morgan IM would execute joint transactions involving 

the Foreign Fund and the Domestic Funds, working with Investment Bank A, Broker-Dealer A, 

and Broker-Dealer B to complete the transactions.  Discussions about the transactions among 

Global Liquidity, others at JP Morgan IM, and Investment Bank A began on March 20, 2020. 

22. Overlapping members of Global Liquidity represented both the Domestic Funds 

and the Foreign Fund in the transactions, working with Investment Bank A and Broker-Dealer B 

that pledged the Repack ABCP to the MMLF.  Additionally, two individuals who were co-

portfolio managers of the Foreign Fund were also co-portfolio managers of the two largest 

Domestic Funds and one of those individuals was a co-portfolio manager for all three Domestic 

Funds and the Foreign Fund. 

23. On March 23, 2020, in coordination with JP Morgan IM, personnel at J.P. Morgan 

Securities LLC (“JP Morgan Securities”) emailed the Fed seeking guidance on whether a 

hypothetical transaction would comply with the intent of the MMLF.  The hypothetical transaction 

posed to the Fed was similar to what later became the Repack ABCP trades.  In the following days, 

the Fed and JP Morgan Securities engaged in further communications about the hypothetical 

transaction.  The Fed ultimately responded that it did not plan to issue any guidance that would 

prevent the hypothetical transaction, but it was not asked to and did not opine on whether the 

transaction would comply with the federal securities laws. 

24. On March 24 and 25, 2020, JP Morgan IM executed the Repack ABCP trades.  In 

total, the Foreign Fund received $4.3 billion in proceeds from asset sales to an affiliated broker-

dealer of Investment Bank A.  As of March 25, 2020, these proceeds represented approximately 

7% of the value of the assets in the Foreign Fund’s portfolio.   

25. The proceeds the Foreign Fund received from the transactions were in excess of the 

amortized cost of the assets it sold to Investment Bank A.  As a result, the Foreign Fund accrued 

$1.5 million in net realized gains from the two transactions. 

26. Investment Bank A used the Foreign Fund securities as collateral for the Repack 

ABCP it issued and then sold to the Domestic Funds.  Because the Foreign Fund’s securities had 

differing maturities, the Repack ABCP also had differing maturities.  The Repack ABCP was not 

sold to the Domestic Funds at the Foreign Fund’s amortized cost or even at the cost at which 

Investment Bank A acquired the Foreign Fund securities.  Instead, the price the Domestic Funds 

paid for the Repack ABCP was set by JP Morgan IM—above amortized cost—so that the 

transactions could fund the Foreign Fund’s $1.5 million in net realized gains, a $1.2 million 

structuring fee paid to Investment Bank A, as well as other transaction costs. 



 

 

 
7 

27. The Domestic Funds bought all $4.3 billion of the Repack ABCP over the course of 

March 24 and 25, 2020, from Broker-Dealer A, which distributed the securities.  On each trading 

day, the Domestic Funds held the Repack ABCP for one day before selling the holdings to Broker-

Dealer B, an MMLF-eligible borrower, at their amortized cost.  There were approximately 

$610,000 in transaction-based fees (mark-ups and mark-downs) from the broker-dealers that 

executed the purchases from Investment Bank A and the sales related to the MMLF pledges. 

28. The Domestic Funds earned approximately $150,000 in interest income by holding 

the Repack ABCP overnight due to its pre-determined 1.3% annualized yield.  This yield was five 

basis points above the minimum yield required by the Fed for assets to qualify for the MMLF.4  

The Domestic Funds earned only one-tenth of the investment gain that the Foreign Fund made 

from the transactions.  Because JP Morgan IM personnel were involved in all aspects of the 

transactions, JP Morgan IM could have allocated more of the investment proceeds from the 

transactions to the Domestic Funds by increasing the annualized yield of the Repack ABCP but did 

not do so.  Broker-Dealer B received five basis points in compensation for pledging the securities 

to the MMLF. 

29. The Repack ABCP had longer duration maturities that extended well beyond a 

single day and into April and May 2020.  Internal daily market surveys created by Global Liquidity 

on March 24 and 25, 2020, stated that the range of yields for asset-backed commercial paper with 

similar one- and two-month maturities were between 1.25% and 2.50%, placing the 1.3% yield JP 

Morgan IM set for the Repack ABCP at the low end of this range. 

30. With the exception of the Repack ABCP purchases, on March 24 and 25, 2020, the 

Domestic Funds primarily acquired fixed income securities with overnight maturities and, in 

limited instances, securities that matured on April 1, 2020.  No other securities the Domestic Funds 

acquired on those days had one- or two-month maturities like the Repack ABCP.     

31. Because the money the Domestic Funds obtained from Broker-Dealer B in 

exchange for their pledges of the Repack ABCP was used to pay for those same securities, these 

transactions did not enhance the Domestic Funds’ liquidity position.  Conversely, the Foreign Fund 

received $4.3 billion in sales proceeds that enhanced its liquidity, which included the $1.5 million 

net realized gain.  

32. JP Morgan IM was aware that the Domestic Funds bore certain risks in the 

transactions that the Foreign Fund did not bear.  For example, certain risks were discussed in a 

                                                 
4  The term sheet for the MMLF stated that the Fed would provide advances of 1% above 

the primary credit rate available to depository institutions, which was 0.25% during this time. 

See  Federal Reserve Board, Money Market Mutual Fund Liquidity Facility, available at 

https://www.federalreserve.gov/newsevents/pressreleases/files/ monetary20201130a2.pdf; 

Federal Reserve Board,  Implementation Note Issued March 15, 2020, available at 

https://www.federalreserve.gov/newsevents/pressreleases/ monetary20200315a1.htm. 

  



 

 

 
8 

memo describing these transactions that was reviewed by the Domestic Funds’ counsel and 

distributed by JP Morgan IM to certain Domestic Funds’ trustees and counsel to the independent 

trustees of the board on March 25, 2020.  The memo stated that JP Morgan IM believed that the 

transactions were in the Domestic Funds’ “best interest”; it also discussed risks that the MMLF 

may cease operating or that the Fed “may reject” the Repack ABCP for “placement into the 

MMLF.”  Under either scenario, the transactions would have had the effect of reducing the 

Domestic Funds’ liquidity positions during a period of time when there were stressed market 

conditions and significant redemption activity in the Domestic Funds.  As of March 25, 2020, the 

Repack ABCP would have constituted 7.7% of the combined assets of the Domestic Funds if the 

MMLF had rejected the Repack ABCP.  Furthermore, because these securities had varying 

maturities extending to as late as May 2020, there was a possibility that the Domestic Funds would 

have had to hold these assets until maturity because it was unlikely that they could sell them in 

stressed market conditions without incurring a loss.  As discussed above, holding these securities 

until their maturity could have reduced the weekly liquid asset levels of the Domestic Funds to 

below 30% of net assets, which could have adversely affected their operations as discussed in 

Paragraphs 13 and 14.  The memo also stated that there was a risk that the Commission would 

view these transactions as joint transactions that violated Section 17(d) of Investment Company 

Act and Rule 17d-1.   

33. After March 25, 2020, the Domestic Funds did not purchase any additional Repack 

ABCP.  In fact, the Domestic Funds did not participate again in MMLF-related transactions until 

April 7 and 9, 2020, when they sold $613 million of other securities to MMLF-eligible borrowers 

that were not structured by JP Morgan IM like the Repack ABCP.  In contrast to the Repack 

ABCP, the Domestic Funds held these securities for between five days and several months prior to 

having them pledged to the MMLF and did not use the proceeds of these sales to enhance the 

liquidity of the Foreign Fund. 

Violations 

34. Section 17(d) of the Investment Company Act prohibits any affiliated person of a 

registered investment company or any affiliated person of such affiliated person (each, an 

“affiliated person”), acting as principal, from effecting any transaction in which such registered 

investment company is a joint or a joint and several participant with an affiliated person in 

contravention of such rules and regulations as the Commission may prescribe.  Section 17(d) is 

intended to limit or prevent participation by such registered company on a basis different from or 

less advantageous than that of another participant.  Rule 17d-1 promulgated under the Investment 

Company Act prohibits any affiliated person from participating in any joint enterprise, other joint 

arrangement, or profit-sharing plan (a “joint arrangement”) unless it obtains an order from the 

Commission permitting the joint arrangement.   

35. As contemplated and executed, the Repack ABCP transactions were joint 

transactions under Section 17(d) and Rule 17d-1.  Accordingly, JP Morgan IM caused violations of 

Section 17(d) of the Investment Company Act and Rule 17d-1 promulgated thereunder by causing 

the Foreign Fund and the Domestic Funds to engage in the Repack ABCP transactions. 



 

 

 
9 

IV. 

 In view of the foregoing, the Commission deems it appropriate to impose the sanctions 

agreed to in Respondent JP Morgan IM’s Offer. 

 Accordingly, it is hereby ORDERED that: 

 A. Pursuant to Section 9(f) of the Investment Company Act, Respondent JP Morgan IM 

cease and desist from committing or causing any violations and any future violations of Section 

17(d) of the Investment Company Act of 1940 and Rule 17d-1 promulgated thereunder. 

B. Pursuant to Section 9(d) of the Investment Company Act, JP Morgan IM shall, 

within twenty-one days of the entry of this Order, pay a civil money penalty in the amount of 

$5,000,000 to the Securities and Exchange Commission for transfer to the general fund of the 

United States Treasury, subject to Exchange Act Section 21F(g)(3).  If timely payment is not 

made, additional interest shall accrue pursuant to 31 U.S.C. § 3717.   

Payment must be made in one of the following ways:   

(1) Respondent may transmit payment electronically to the Commission, which 

will provide detailed ACH transfer/Fedwire instructions upon request;  

(2) Respondent may make direct payment from a bank account via Pay.gov 

through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  

(3) Respondent may pay by certified check, bank cashier’s check, or United 

States postal money order, made payable to the Securities and Exchange 

Commission and hand-delivered or mailed to:  

Enterprise Services Center 

Accounts Receivable Branch 

HQ Bldg., Room 181, AMZ-341 

6500 South MacArthur Boulevard 

Oklahoma City, OK 73169 

Payments by check or money order must be accompanied by a cover letter identifying JP 

Morgan IM as a Respondent in these proceedings, and the file number of these proceedings; a copy 

of the cover letter and check or money order must be sent to Lee A. Greenwood, Assistant 

Regional Director, Asset Management Unit, Division of Enforcement, Securities and Exchange 

Commission, 100 Pearl Street, Suite 20-100, New York, NY 10004.   

 C. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 

treated as penalties paid to the government for all purposes, including all tax purposes.  To 

preserve the deterrent effect of the civil penalty, Respondent agrees that in any Related Investor 

Action, it shall not argue that it is entitled to, nor shall it benefit by, offset or reduction of any 

http://www.sec.gov/about/offices/ofm.htm


 

 

 
10 

award of compensatory damages by the amount of any part of Respondent’s payment of a civil 

penalty in this action (“Penalty Offset”).  If the court in any Related Investor Action grants such a 

Penalty Offset, Respondent agrees that it shall, within 30 days after entry of a final order granting 

the Penalty Offset, notify the Commission's counsel in this action and pay the amount of the 

Penalty Offset to the Securities and Exchange Commission.  Such a payment shall not be deemed 

an additional civil penalty and shall not be deemed to change the amount of the civil penalty 

imposed in this proceeding.  For purposes of this paragraph, a “Related Investor Action” means a 

private damages action brought against Respondent by or on behalf of one or more investors based 

on substantially the same facts as alleged in the Order instituted by the Commission in this 

proceeding. 

 By the Commission. 

 

 

Vanessa A. Countryman 

        Secretary 


	UNITED STATES OF AMERICA
	Respondent
	Other Relevant Entities
	The Domestic Funds, the Foreign Fund, and Stressed Market Conditions