South Florida Arbitration & Litigation Lawyer Blog
In the Matter of Eugenio Verzili
Recently, the Securities and Exchange Commission (“the Commission”) issued an Order Instituting Administrative Proceedings Pursuant to Section 203(f) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions (Order) against Eugenio Verzili (Verzili). The Order finds that on July 3, 2012, a judgment was entered by consent against Verzili in SEC v. Juno Mother Earth Asset Management, LLC, et al. (Civil Action Number 11 Civ. 1778 (TPG) (S.D.N.Y.)), permanently enjoining Verzili from violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder, and Sections 203A, 206(1), 206(2), 206(4) and 207 of the Advisers Act of 1940, and Rules 206(4)-2 and 206(4)-8 thereunder.
The Order finds that the Commission’s complaint in SEC v. Juno Mother Earth Asset Management, LLC, et al. alleged that Verzili, Arturo Allan Rodriguez Lopez and Juno Mother Earth Asset Management LLC (Juno) orchestrated a multi-faceted scheme to defraud a hedge fund under their control, as well as the investors in the fund, and failed to comply with their fiduciary obligations to the hedge fund, through: (a) misappropriating approximately $1.8 million of assets from a Juno-advised hedge fund; (b) fraudulently concealing their misappropriation from the fund’s independent directors; (c) inflating and misrepresenting Juno’s assets under management by approximately $40 million; (d) filing false Forms ADV with the Commission that, among other things, failed to disclose transactions between Juno and the hedge fund; (e) concealing Juno’s precarious financial condition; and (f) misrepresenting the amount of capital certain Juno partners had invested in a Juno-advised fund.
Based on the above, the Order bars Verzili barred from association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization. Verzili consented to the issuance of the Order without admitting or denying any of the findings in the Commission’s Order, except that he admitted the entry of injunction.
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