In re Newman Ladd Capital Advisors

UNITED STATES OF AMERICA 
Before the 
SECURITIES AND EXCHANGE COMMISSION 
 
INVESTMENT ADVISERS ACT OF 1940 
Release No. 5920 / December 10, 2021 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-20670 
 
 
In the Matter of 
 
Newman Ladd Capital Advisors, LLC, 
 
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 Newman Ladd Capital Advisors, LLC (“NLCA” 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 
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 that:  
 
Summary 
 
1. This matter involves NLCA’s failure to file with the Commission and to deliver to 
retail investor clients its Form CRS.  NLCA was required to file its initial Form CRS with the 
Commission as Part 3 of its Form ADV and to begin delivering its Form CRS to prospective and 
new retail investor clients, as applicable, by June 30, 2020.  NLCA was further required to deliver 
its Form CRS to existing retail investor clients by July 30, 2020.  The firm failed to file and 
deliver Form CRS by these deadlines, not becoming compliant until in or after June 2021.  As a 
result, NLCA violated Advisers Act Section 204 and Rules 204-1 and 204-5 thereunder. 
Respondent 
2. NLCA is a New York limited liability company with its principal place of business 
in Camillus, New York.  NLCA has been registered with the Commission as an investment adviser 
since March 6, 2014.  On its Form ADV dated August 3, 2021, NLCA reported that it had 
approximately $107M in regulatory assets under management and 306 individual clients.   
Facts 
3. On June 5, 2019, the Commission adopted Form CRS and rules creating new 
requirements—the Form CRS Filing Requirement and the Form CRS Delivery Requirement 
(collectively, the “Requirements”)—for Commission-registered investment advisers offering 
services to a retail investor.
1
  See Form CRS Relationship Summary; Amendments to Form ADV, 
Release Nos. 34-86032 & IA-5247 (June 5, 2019) (effective September 10, 2019) (“Form CRS 
Adopting Release”). 
 
4. The Form CRS Filing Requirement.  First, Rule 204-1(e) under the Advisers Act 
requires all Commission-registered investment advisers offering services to a retail investor 
(“Retail RIAs”) to amend their Form ADV by electronically filing on the Investment Adviser 
Registration Database (“IARD”) an initial Form CRS satisfying the requirements of Part 3 of 
Form ADV no later than June 30, 2020. 
 
5. The Form CRS Delivery Requirement.  Second, Rule 204-5 under the Advisers 
Act requires Retail RIAs to deliver their current Form CRS to each retail investor client.  
Specifically, under Rule 204-5(b) under the Advisers Act, the Retail RIA must deliver: (1) to 
each retail investor client its current Form CRS before or at the time the firm enters into an 
investment advisory contract with that client; and (2) to each retail investor client who is an 
existing client the Retail RIA’s current Form CRS before or at the time the firm: 
                                                 
1
  For purposes of Form CRS, the term “retail investor” means “a natural person, or the 
legal representative of such natural person, who seeks to receive or receives services primarily 
for personal, family or household purposes.”  Rule 204-5(d)(2) under the Advisers Act. 

3 
 
 opens a new account that is different from the retail investor client’s 
existing account(s); 
 recommends that the retail investor client roll over assets from a 
retirement account into a new or existing account or investment; or 
 recommends or provides a new investment advisory service or investment 
that does not necessarily involve the opening of a new account and would 
not be held in an existing account. 
See Rule 204-5(b)(1) & (b)(2).  Rule 204-5(b)(3) also requires Retail RIAs to post their current 
Form CRS prominently on their website, if they have one, in a location and format that is easily 
accessible to retail investors.  The deadline for Retail RIAs to begin complying with the Form 
CRS Delivery Requirement was June 30, 2020 for prospective and new retail investor clients and 
July 30, 2020 for the initial delivery to existing retail investor clients.  See Rule 204-5(e)(1) & 
(e)(2); Form CRS Adopting Release at 239, 242, 406-407; Form ADV, Part 3: Instructions to 
Form CRS, General Instruction 7.C (Sept. 2019). 
 
6. NLCA failed to comply with the Requirements by its regulatory deadlines, and 
began complying only after the Division of Examinations (“EXAMS”) contacted the firm 
regarding the failure to file its Form CRS.  Specifically, EXAMS contacted NLCA’s Chief 
Compliance Officer by email on October 14, 2020 to alert him that the firm had failed to file 
Form CRS.  NLCA, however, still did not file its Form CRS.  On March 30, 2021, EXAMS 
again contacted NLCA but this time to announce an examination relating to the firm’s failure to 
file Form CRS.  NLCA finally filed Form CRS with the Commission on June 7, 2021, and the 
firm did not deliver Form CRS to its existing retail investor clients until June 2021. NLCA does 
not have a website.   
 
Violations 
7. As a result of the conduct described above, NLCA willfully
2
 violated Section 204 
of the Advisers Act and Rules 204-1 and 204-5 thereunder. 
IV. 
 In view of the foregoing, the Commission deems it appropriate and in the public interest 
to impose the sanctions agreed to in Respondent NLCA’s Offer. 
 
                                                 
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.’”  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)).  There is no requirement that the actor “also be aware that he is 
violating one of the Rules or Acts.”  Tager v. SEC, 344 F.2d 5, 8 (2d Cir. 1965).  The decision in 
The Robare Group, Ltd. v. SEC, which construed the term “willfully” for purposes of a 
differently structured statutory provision, does not alter that standard.  922 F.3d 468, 478-79 
(D.C. Cir. 2019) (setting forth the showing required to establish that a person has “willfully 
omit[ted]” material information from a required disclosure in violation of Section 207 of the 
Advisers Act). 

4 
 
 Accordingly, pursuant to Sections 203(e) and 203(k) of the Advisers Act, it is hereby 
ORDERED that: 
 
 A. Respondent cease and desist from committing or causing any violations and any 
future violations of Advisers Act Section 204 and Rules 204-1 and 204-5 thereunder. 
 
B.  Respondent is censured. 
 
C.  Respondent shall, within 10 days of the entry of this Order, pay a civil money 
penalty in the amount of $25,000 to the Securities and Exchange Commission for transfer to the 
general fund of the United States Treasury, subject to Securities Exchange Act of 1934 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 
NLCA 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 Lara Mehraban, Associate Regional 
Director, New York Regional Office, Securities and Exchange Commission, Brookfield Place, 
200 Vesey Street, Suite 400, New York, NY 10281. 
 
 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 

5 
 
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 ADVISERS ACT OF 1940 

Release No. 5920 / December 10, 2021 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-20670 

 

 

In the Matter of 

 

Newman Ladd Capital Advisors, LLC, 

 

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 Newman Ladd Capital Advisors, LLC (“NLCA” 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 

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 that:  

 

Summary 
 

1. This matter involves NLCA’s failure to file with the Commission and to deliver to 

retail investor clients its Form CRS.  NLCA was required to file its initial Form CRS with the 

Commission as Part 3 of its Form ADV and to begin delivering its Form CRS to prospective and 

new retail investor clients, as applicable, by June 30, 2020.  NLCA was further required to deliver 

its Form CRS to existing retail investor clients by July 30, 2020.  The firm failed to file and 

deliver Form CRS by these deadlines, not becoming compliant until in or after June 2021.  As a 

result, NLCA violated Advisers Act Section 204 and Rules 204-1 and 204-5 thereunder. 

Respondent 

2. NLCA is a New York limited liability company with its principal place of business 

in Camillus, New York.  NLCA has been registered with the Commission as an investment adviser 

since March 6, 2014.  On its Form ADV dated August 3, 2021, NLCA reported that it had 

approximately $107M in regulatory assets under management and 306 individual clients.   

Facts 

3. On June 5, 2019, the Commission adopted Form CRS and rules creating new 

requirements—the Form CRS Filing Requirement and the Form CRS Delivery Requirement 

(collectively, the “Requirements”)—for Commission-registered investment advisers offering 

services to a retail investor.1  See Form CRS Relationship Summary; Amendments to Form ADV, 

Release Nos. 34-86032 & IA-5247 (June 5, 2019) (effective September 10, 2019) (“Form CRS 

Adopting Release”). 
 
4. The Form CRS Filing Requirement.  First, Rule 204-1(e) under the Advisers Act 

requires all Commission-registered investment advisers offering services to a retail investor 

(“Retail RIAs”) to amend their Form ADV by electronically filing on the Investment Adviser 

Registration Database (“IARD”) an initial Form CRS satisfying the requirements of Part 3 of 

Form ADV no later than June 30, 2020. 
 
5. The Form CRS Delivery Requirement.  Second, Rule 204-5 under the Advisers 

Act requires Retail RIAs to deliver their current Form CRS to each retail investor client.  

Specifically, under Rule 204-5(b) under the Advisers Act, the Retail RIA must deliver: (1) to 

each retail investor client its current Form CRS before or at the time the firm enters into an 

investment advisory contract with that client; and (2) to each retail investor client who is an 

existing client the Retail RIA’s current Form CRS before or at the time the firm: 

                                                 
1  For purposes of Form CRS, the term “retail investor” means “a natural person, or the 

legal representative of such natural person, who seeks to receive or receives services primarily 

for personal, family or household purposes.”  Rule 204-5(d)(2) under the Advisers Act. 



3 

 

 opens a new account that is different from the retail investor client’s 

existing account(s); 

 recommends that the retail investor client roll over assets from a 

retirement account into a new or existing account or investment; or 

 recommends or provides a new investment advisory service or investment 

that does not necessarily involve the opening of a new account and would 

not be held in an existing account. 

See Rule 204-5(b)(1) & (b)(2).  Rule 204-5(b)(3) also requires Retail RIAs to post their current 

Form CRS prominently on their website, if they have one, in a location and format that is easily 

accessible to retail investors.  The deadline for Retail RIAs to begin complying with the Form 

CRS Delivery Requirement was June 30, 2020 for prospective and new retail investor clients and 

July 30, 2020 for the initial delivery to existing retail investor clients.  See Rule 204-5(e)(1) & 

(e)(2); Form CRS Adopting Release at 239, 242, 406-407; Form ADV, Part 3: Instructions to 

Form CRS, General Instruction 7.C (Sept. 2019). 

 

6. NLCA failed to comply with the Requirements by its regulatory deadlines, and 

began complying only after the Division of Examinations (“EXAMS”) contacted the firm 

regarding the failure to file its Form CRS.  Specifically, EXAMS contacted NLCA’s Chief 

Compliance Officer by email on October 14, 2020 to alert him that the firm had failed to file 

Form CRS.  NLCA, however, still did not file its Form CRS.  On March 30, 2021, EXAMS 

again contacted NLCA but this time to announce an examination relating to the firm’s failure to 

file Form CRS.  NLCA finally filed Form CRS with the Commission on June 7, 2021, and the 

firm did not deliver Form CRS to its existing retail investor clients until June 2021. NLCA does 

not have a website.   

 

Violations 

7. As a result of the conduct described above, NLCA willfully2 violated Section 204 

of the Advisers Act and Rules 204-1 and 204-5 thereunder. 

IV. 

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

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

 

                                                 
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.’”  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)).  There is no requirement that the actor “also be aware that he is 

violating one of the Rules or Acts.”  Tager v. SEC, 344 F.2d 5, 8 (2d Cir. 1965).  The decision in 

The Robare Group, Ltd. v. SEC, which construed the term “willfully” for purposes of a 

differently structured statutory provision, does not alter that standard.  922 F.3d 468, 478-79 

(D.C. Cir. 2019) (setting forth the showing required to establish that a person has “willfully 

omit[ted]” material information from a required disclosure in violation of Section 207 of the 

Advisers Act). 



4 

 

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

ORDERED that: 

 

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

future violations of Advisers Act Section 204 and Rules 204-1 and 204-5 thereunder. 

 

B.  Respondent is censured. 

 

C.  Respondent shall, within 10 days of the entry of this Order, pay a civil money 

penalty in the amount of $25,000 to the Securities and Exchange Commission for transfer to the 

general fund of the United States Treasury, subject to Securities Exchange Act of 1934 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 

NLCA 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 Lara Mehraban, Associate Regional 

Director, New York Regional Office, Securities and Exchange Commission, Brookfield Place, 

200 Vesey Street, Suite 400, New York, NY 10281. 

 

 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 

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


5 

 

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