In re P. SCHOENFELD ASSET

UNITED STATES OF AMERICA 
Before the 
SECURITIES AND EXCHANGE COMMISSION 
 
 
INVESTMENT ADVISERS ACT OF 1940 
Release No. 6652 / August 14 2024 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-21999 
 
In the Matter of 
P. SCHOENFELD ASSET 
MANAGEMENT LP, 
Respondent. 
ORDER INSTITUTING ADMINISTRATIVE 
AND CEASE-AND-DESIST PROCEEDINGS, 
PURSUANT TO SECTIONS 203(e) AND 
203(k) OF THE INVESTMENT ADVISERS 
ACT OF 1940, MAKING FINDINGS, AND 
IMPOSING REMEDIAL SANCTIONS AND 
A CEASE-AND-DESIST ORDER 
 
 
 
 
I. 
The Securities and Exchange Commission (“Commission”) deems it appropriate and in 
the public interest that public administrative and cease-and-desist proceedings be, and hereby 
are, instituted pursuant to Sections 203(e) and 203(k) of the Investment Advisers Act of 1940 
(“Advisers Act”) against P. Schoenfeld Asset Management LP (“PSAM” or “Respondent”). 
 
II. 
In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (“Offer”) that the Commission has determined to accept. Respondent admits the 
facts set forth in Section III below, acknowledges that its conduct violated the federal securities 
laws, admits the Commission’s jurisdiction over it and the subject matter of these proceedings, and 
consents to the entry of this Order Instituting Administrative and Cease-and-Desist Proceedings, 
Pursuant to Sections 203(e) and 203(k) of the Investment Advisers Act of 1940, Making Findings, 
and Imposing Remedial Sanctions and a Cease-and-Desist Order (“Order”), as set forth below. 

2 
 
III. 
On the basis of this Order and Respondent’s Offer, the Commission finds
1 
that 
 
Summary 
1. The federal securities laws impose recordkeeping requirements on registered 
investment advisers to ensure that they responsibly discharge their crucial role in our markets. 
The Commission has long said that compliance with these requirements is essential to investor 
protection and the Commission’s efforts to further its mandate of protecting investors, 
maintaining fair, orderly, and efficient markets, and facilitating capital formation. 
2. These proceedings arise out of the widespread and longstanding failure of PSAM 
personnel throughout the firm, including at senior levels, to adhere to certain of these essential 
requirements and the firm’s own policies. Using their personal devices, these personnel 
communicated both internally and externally by text messages and/or other unapproved written 
communications platforms (“off-channel communications”). 
3. From at least October 18, 2018 to December 31, 2021 (the “Relevant Period”), 
PSAM personnel sent and received off-channel communications that were records required to be 
maintained under Advisers Act Rule 204-2(a)(7). Respondent did not maintain or preserve the 
substantial majority of these written communications. Respondent’s failures were firm-wide and 
involved personnel at various levels of authority throughout the organization. As a result PSAM 
violated Section 204 of the Advisers Act and Rule 204-2(a)(7) thereunder. 
4. PSAM’s widespread failure to implement a system of monitoring reasonably 
expected to determine whether personnel were following its policies and procedures that prohibit 
off-channel communications led to its failure to reasonably supervise its personnel within the 
meaning of Section 203(e)(6) of the Advisers Act. 
5. During the Relevant Period, PSAM received and responded to Commission 
requests for documents in an examination and an investigation. As a result, PSAM’s 
recordkeeping failures likely impacted the Commission’s ability to carry out its regulatory 
functions and investigate violations of the federal securities laws. 
6. Commission staff found PSAM’s misconduct after an examination revealed the 
use of off-channel and unpreserved communications. PSAM initiated a review of its 
recordkeeping failures and implemented a program of remediation. 
 
Respondent 
 
 
 
 
 
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. 

3 
 
7. P. Schoenfeld Asset Management LP is a Delaware limited partnership with its 
principal place of business in New York, New York. Since March 2009, it has been registered 
with the Commission as an investment adviser. 
 
 
 
 
Recordkeeping Requirements under the Advisers Act 
 
8. Section 204 of the Advisers Act authorizes the Commission to issue rules 
requiring investment advisers to make and keep for prescribed periods, and furnish copies of, 
such records as necessary or appropriate in the public interest, for the protection of investors. 
9. The Commission adopted Rule 204-2 pursuant to this authority. This rule 
specifies the manner and length of time that the records created in accordance with Commission 
rules, and certain other records produced by investment advisers, must be maintained and 
produced promptly to Commission representatives. 
10. The rules adopted under Advisers Act Section 204, including Advisers Act Rule 
204-2(a)(7), require that investment advisers preserve in an easily accessible place originals of 
all communications received and copies of all written communications sent relating to, among 
other things: (a) any recommendation made or proposed to be made and any advice given or 
proposed to be given; (b) any receipt, disbursement, or delivery of funds or securities; (c) the 
placing or execution of any order to purchase or sell any security; or (d) predecessor 
performance and the performance or rate of return of any or all managed accounts, portfolios, or 
securities recommendations. 
PSAM’s Policies and Procedures 
 
11. PSAM maintained certain policies and procedures designed to ensure the 
retention of business-related records, including electronic communications, in compliance with 
the relevant recordkeeping provisions. 
12. PSAM’s personnel were advised that the use of unapproved electronic 
communications methods, including on their personal devices, was not permitted, and they 
should not use personal email or unapproved chat or text messaging applications for business 
purposes. PSAM’s compliance manual provided that employees were “prohibited from 
conducting PSAM business using any other electronic communication services . . . or accounts 
not provided by PSAM”. 
13. Messages sent through PSAM’s approved communications methods were 
monitored, subject to review, and, when appropriate, archived. Messages sent through 
unapproved communications methods, such as unapproved applications on personal devices, 
were not monitored, subject to review, or archived. 

4 
 
14. PSAM’s employees acknowledged during the Relevant Period in writing that they 
read, understood, and abided by PSAM’s compliance manual, which provided that the use of 
unapproved electronic communication methods, including on their personal devices, was not 
permitted, and that they should not use personal email or any form of non-work authorized text 
messaging to transmit work-related messages. 
15. PSAM, however, failed to implement a system of monitoring reasonably expected 
to determine whether personnel were following its policies. While permitting its personnel to 
use approved communications methods, including on personal phones, for business 
communications, PSAM failed to implement sufficient monitoring to ensure that its 
recordkeeping and communications policies were being followed. 
 
PSAM’s Recordkeeping Failures 
 
16. During the course of an examination, Commission staff discovered that PSAM 
had not maintained books and records as required under the Advisers Act. During the following 
investigation, PSAM cooperated by gathering and imaging communications from the personal 
devices of its employees. 
17. The Commission staff’s investigation found pervasive off-channel 
communications by PSAM personnel. Most PSAM personnel whose communications were 
reviewed in the course of the investigation had sent or received off-channel communications that 
were records required to be preserved by PSAM under the Advisers Act. These off-channel 
communications were sent among PSAM colleagues as well as to and from PSAM clients, 
counterparties, and other financial industry participants. 
18. Off-channel communications included records required to be preserved under the 
Advisers Act because they related to an advisory recommendation made or proposed to be made 
or advice given or proposed to be given. For example, a PSAM employee exchanged text 
messages on an unapproved platform with a client concerning investment strategy. 
19. Other off-channel communications were records required to be preserved under 
the Advisers Act because they related to the placing or execution of orders to purchase or sell 
securities. 
PSAM’s Failure to Preserve Required Records Potentially 
Compromised and Delayed Commission Matters 
20. During the Relevant Period, PSAM received and responded to various 
Commission requests for documents. By failing to maintain and preserve required records 
relating to its business, PSAM likely deprived the Commission of off-channel communications. 

5 
 
PSAM’s Violations and Failure to Supervise 
 
21. As a result of the conduct during the Relevant Period described above, PSAM 
willfully
2 
violated Section 204 of the Advisers Act and Rule 204-2(a)(7) thereunder. 
22. As a result of the conduct described above, PSAM failed reasonably to supervise 
its personnel, with a view to preventing or detecting certain of its supervised persons’ aiding and 
abetting violations of Section 204 of the Advisers Act and Rule 204-2(a)(7) thereunder, within 
the meaning of Section 203(e)(6) of the Advisers Act. 
PSAM’s Remedial Efforts 
23. In determining to accept the Offer, the Commission considered steps undertaken by 
PSAM prior to and during the course of the staff’s investigation, as well as cooperation afforded 
the Commission staff. Prior to the commencement of the staff’s investigation, PSAM had already 
begun implementing technological improvements to enhance the firm’s capability to preserve its 
employees’ electronic communications, and PSAM had retained, and has continued to use, a 
compliance consultant tasked with remediating its recordkeeping deficiencies, and conducting 
ongoing monitoring for potential non-compliance with firm policies. 
IV. 
In view of the foregoing, the Commission deems it appropriate and in the public interest 
to impose the sanctions agreed to in Respondent’s Offer. 
 
Accordingly, pursuant to Sections 203(e) and 203(k) of the Advisers Act, it is hereby 
ORDERED that: 
 
A. Respondent shall cease and desist from committing or causing any violations and 
any future violations of Section 204 of the Advisers Act and Rule 204-2 
thereunder. 
B. Respondent is censured. 
C. Respondent shall, within 14 days of the entry of this Order, pay a civil money 
penalty in the amount of $1,250,000 to the Securities and Exchange Commission 
for transfer to the general fund of the United States Treasury, subject to Exchange 
 
 
 
2 
“Willfully,” for purposes of imposing relief under Section 203(e) of the Advisers Act, “‘means 
no more than that the person charged with the duty knows what he is doing.’” See Wonsover v. 
SEC, 205 F.3d 408, 414 (D.C. Cir. 2000) (quoting Hughes v. SEC, 174 F.2d 969, 977 (D.C. Cir. 
1949)). 

6 
 
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 
PSAM as the 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 Thomas P. Smith, Jr., Associate 
Regional Director, Division of Enforcement, Securities and Exchange Commission, New York 
Regional Office, 100 Pearl Street, Suite 20-100, New York, NY 10004. 
 
D. 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 
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 

7 
 
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 ADVISERS ACT OF 1940 

Release No. 6652 / August 14 2024 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-21999 

 

In the Matter of 

P. SCHOENFELD ASSET 

MANAGEMENT LP, 

Respondent. 

ORDER INSTITUTING ADMINISTRATIVE 

AND CEASE-AND-DESIST PROCEEDINGS, 

PURSUANT TO SECTIONS 203(e) AND 

203(k) OF THE INVESTMENT ADVISERS 

ACT OF 1940, MAKING FINDINGS, AND 

IMPOSING REMEDIAL SANCTIONS AND 

A CEASE-AND-DESIST ORDER 

 

 

 

 

I. 

The Securities and Exchange Commission (“Commission”) deems it appropriate and in 

the public interest that public administrative and cease-and-desist proceedings be, and hereby 

are, instituted pursuant to Sections 203(e) and 203(k) of the Investment Advisers Act of 1940 

(“Advisers Act”) against P. Schoenfeld Asset Management LP (“PSAM” or “Respondent”). 

 

II. 

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

of Settlement (“Offer”) that the Commission has determined to accept. Respondent admits the 

facts set forth in Section III below, acknowledges that its conduct violated the federal securities 

laws, admits the Commission’s jurisdiction over it and the subject matter of these proceedings, and 

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

Pursuant to Sections 203(e) and 203(k) of the Investment Advisers Act of 1940, Making Findings, 

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



2  

III. 

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

 

Summary 

1. The federal securities laws impose recordkeeping requirements on registered 

investment advisers to ensure that they responsibly discharge their crucial role in our markets. 

The Commission has long said that compliance with these requirements is essential to investor 

protection and the Commission’s efforts to further its mandate of protecting investors, 

maintaining fair, orderly, and efficient markets, and facilitating capital formation. 

2. These proceedings arise out of the widespread and longstanding failure of PSAM 

personnel throughout the firm, including at senior levels, to adhere to certain of these essential 

requirements and the firm’s own policies. Using their personal devices, these personnel 

communicated both internally and externally by text messages and/or other unapproved written 

communications platforms (“off-channel communications”). 

3. From at least October 18, 2018 to December 31, 2021 (the “Relevant Period”), 

PSAM personnel sent and received off-channel communications that were records required to be 

maintained under Advisers Act Rule 204-2(a)(7). Respondent did not maintain or preserve the 

substantial majority of these written communications. Respondent’s failures were firm-wide and 

involved personnel at various levels of authority throughout the organization. As a result PSAM 

violated Section 204 of the Advisers Act and Rule 204-2(a)(7) thereunder. 

4. PSAM’s widespread failure to implement a system of monitoring reasonably 

expected to determine whether personnel were following its policies and procedures that prohibit 

off-channel communications led to its failure to reasonably supervise its personnel within the 

meaning of Section 203(e)(6) of the Advisers Act. 

5. During the Relevant Period, PSAM received and responded to Commission 

requests for documents in an examination and an investigation. As a result, PSAM’s 

recordkeeping failures likely impacted the Commission’s ability to carry out its regulatory 

functions and investigate violations of the federal securities laws. 

6. Commission staff found PSAM’s misconduct after an examination revealed the 

use of off-channel and unpreserved communications. PSAM initiated a review of its 

recordkeeping failures and implemented a program of remediation. 

 

Respondent 
 

 

 

 

 

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. 



3  

7. P. Schoenfeld Asset Management LP is a Delaware limited partnership with its 

principal place of business in New York, New York. Since March 2009, it has been registered 

with the Commission as an investment adviser. 

 

 

 

 

Recordkeeping Requirements under the Advisers Act 

 

8. Section 204 of the Advisers Act authorizes the Commission to issue rules 

requiring investment advisers to make and keep for prescribed periods, and furnish copies of, 

such records as necessary or appropriate in the public interest, for the protection of investors. 

9. The Commission adopted Rule 204-2 pursuant to this authority. This rule 

specifies the manner and length of time that the records created in accordance with Commission 

rules, and certain other records produced by investment advisers, must be maintained and 

produced promptly to Commission representatives. 

10. The rules adopted under Advisers Act Section 204, including Advisers Act Rule 

204-2(a)(7), require that investment advisers preserve in an easily accessible place originals of 

all communications received and copies of all written communications sent relating to, among 

other things: (a) any recommendation made or proposed to be made and any advice given or 

proposed to be given; (b) any receipt, disbursement, or delivery of funds or securities; (c) the 

placing or execution of any order to purchase or sell any security; or (d) predecessor 

performance and the performance or rate of return of any or all managed accounts, portfolios, or 

securities recommendations. 

PSAM’s Policies and Procedures 

 

11. PSAM maintained certain policies and procedures designed to ensure the 

retention of business-related records, including electronic communications, in compliance with 

the relevant recordkeeping provisions. 

12. PSAM’s personnel were advised that the use of unapproved electronic 

communications methods, including on their personal devices, was not permitted, and they 

should not use personal email or unapproved chat or text messaging applications for business 

purposes. PSAM’s compliance manual provided that employees were “prohibited from 

conducting PSAM business using any other electronic communication services . . . or accounts 

not provided by PSAM”. 

13. Messages sent through PSAM’s approved communications methods were 

monitored, subject to review, and, when appropriate, archived. Messages sent through 

unapproved communications methods, such as unapproved applications on personal devices, 

were not monitored, subject to review, or archived. 



4  

14. PSAM’s employees acknowledged during the Relevant Period in writing that they 

read, understood, and abided by PSAM’s compliance manual, which provided that the use of 

unapproved electronic communication methods, including on their personal devices, was not 

permitted, and that they should not use personal email or any form of non-work authorized text 

messaging to transmit work-related messages. 

15. PSAM, however, failed to implement a system of monitoring reasonably expected 

to determine whether personnel were following its policies. While permitting its personnel to 

use approved communications methods, including on personal phones, for business 

communications, PSAM failed to implement sufficient monitoring to ensure that its 

recordkeeping and communications policies were being followed. 

 

PSAM’s Recordkeeping Failures 

 

16. During the course of an examination, Commission staff discovered that PSAM 

had not maintained books and records as required under the Advisers Act. During the following 

investigation, PSAM cooperated by gathering and imaging communications from the personal 

devices of its employees. 

17. The Commission staff’s investigation found pervasive off-channel 

communications by PSAM personnel. Most PSAM personnel whose communications were 

reviewed in the course of the investigation had sent or received off-channel communications that 

were records required to be preserved by PSAM under the Advisers Act. These off-channel 

communications were sent among PSAM colleagues as well as to and from PSAM clients, 

counterparties, and other financial industry participants. 

18. Off-channel communications included records required to be preserved under the 

Advisers Act because they related to an advisory recommendation made or proposed to be made 

or advice given or proposed to be given. For example, a PSAM employee exchanged text 

messages on an unapproved platform with a client concerning investment strategy. 

19. Other off-channel communications were records required to be preserved under 

the Advisers Act because they related to the placing or execution of orders to purchase or sell 

securities. 

PSAM’s Failure to Preserve Required Records Potentially 

Compromised and Delayed Commission Matters 

20. During the Relevant Period, PSAM received and responded to various 

Commission requests for documents. By failing to maintain and preserve required records 

relating to its business, PSAM likely deprived the Commission of off-channel communications. 



5  

PSAM’s Violations and Failure to Supervise 

 

21. As a result of the conduct during the Relevant Period described above, PSAM 

willfully2 violated Section 204 of the Advisers Act and Rule 204-2(a)(7) thereunder. 

22. As a result of the conduct described above, PSAM failed reasonably to supervise 

its personnel, with a view to preventing or detecting certain of its supervised persons’ aiding and 

abetting violations of Section 204 of the Advisers Act and Rule 204-2(a)(7) thereunder, within 

the meaning of Section 203(e)(6) of the Advisers Act. 

PSAM’s Remedial Efforts 

23. In determining to accept the Offer, the Commission considered steps undertaken by 

PSAM prior to and during the course of the staff’s investigation, as well as cooperation afforded 

the Commission staff. Prior to the commencement of the staff’s investigation, PSAM had already 

begun implementing technological improvements to enhance the firm’s capability to preserve its 

employees’ electronic communications, and PSAM had retained, and has continued to use, a 

compliance consultant tasked with remediating its recordkeeping deficiencies, and conducting 

ongoing monitoring for potential non-compliance with firm policies. 

IV. 

In view of the foregoing, the Commission deems it appropriate and in the public interest 

to impose the sanctions agreed to in Respondent’s Offer. 

 

Accordingly, pursuant to Sections 203(e) and 203(k) of the Advisers Act, it is hereby 

ORDERED that: 

 

A. Respondent shall cease and desist from committing or causing any violations and 

any future violations of Section 204 of the Advisers Act and Rule 204-2 

thereunder. 

B. Respondent is censured. 

C. Respondent shall, within 14 days of the entry of this Order, pay a civil money 

penalty in the amount of $1,250,000 to the Securities and Exchange Commission 

for transfer to the general fund of the United States Treasury, subject to Exchange 
 

 

 

2 “Willfully,” for purposes of imposing relief under Section 203(e) of the Advisers Act, “‘means 

no more than that the person charged with the duty knows what he is doing.’” See Wonsover v. 

SEC, 205 F.3d 408, 414 (D.C. Cir. 2000) (quoting Hughes v. SEC, 174 F.2d 969, 977 (D.C. Cir. 

1949)). 



6  

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 

PSAM as the 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 Thomas P. Smith, Jr., Associate 

Regional Director, Division of Enforcement, Securities and Exchange Commission, New York 

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

 

D. 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 

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 

http://www.sec.gov/about/offices/ofm.htm%3B


7  

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