Lexington All Over Again

Since becoming aware as a child I have often wondered if had I lived along the Boston-Concord Highway in Massachusetts roughly 239 years ago… whether I would have taken up my gun and head to Lexington? Or if I would sit and let others do it for me…

Pondering this as an idealistic youngster, I would certainly have gone and fought.  But as a mature, responsible individual I have questioned that automatic reaction….. It appears ones level of action depends on what one has to lose.  Being young, there is no lost investment one puts at risk. Being older, there is.

Today when we sit back, we know how that history played out.  That clouds our judgment: “Oh sure” we’d say, “I’d have grabbed my gun and stood in that square.” but we say that knowing full well how the British lost and the Royalists were run off to Canada… However, to those at that time, there appeared a greater chance for the opposite to occur.  Back then, Britain was the United States of today….

How could some dirt farmers overwhelm the world’s greatest army?  Fortunately for us today, they didn’t think like that or didn’t care, and in that there is the lesson for today.

As George Washington was hounded, as was Andrew Jackson, as was Abraham Lincoln, we living today have systematically against all facts and evidence to the contrary, been repeatedly told our current leader is an incredible disaster waiting to happen.  We have waited 6 years with the same repeating messages and yet so far things keep improving, getting better and better.

It is time we fire the messengers.  The lying messengers.

Like those Massachusetts’ farmers we too have two choices to make.  We can stay with what has been broken, and cling to the fact that it is not yet as broken as it could be, or…. we can throw our hearts behind the possibility of achieving real change,  betterment for our children, and a future brighter than our dreams can imagine upon looking through the reality of today…

Every lie so far told, each intended to scare us away from not achieving that dream we hold for ourselves (instead to accept theirs), has so far been false. Health care CAN be effectively controlled.  We CAN get Osama Bin Ladin. We CAN rebuild America’s auto industry. We CAN negotiate with Russia, Syria, Iran, Egypt, Israel, China and not have to go on a national alert as does North Korea does every time it faces an internal domestic crises.  We CAN stop Ebola from spreading here.  We didn’t have a crises in Benghazi. We didn’t have malpractice in the IRS.  We CAN raise taxes on our top earners and grow jobs faster than we could with tax cuts.  We CAN have gas prices at $2.84 a gallon for unleaded.  We CAN have people in love with each other, marry for life without the world caving in. WE CAN grow jobs at rates over 200,000 per month.  We CAN have the stock market earn rates over 30% per year….

Compare that to their alternative?  We could take 25 million Americans off  their health insurance. We could shut down our government, costing America another $25 billion of lost economic activity. We could again tax the middle class with user fees to pay for the tax cuts the top 1% can simply get for asking. We could make seniors pay more for their medical care and hospital visits,  and cut Medicare payments to doctors and hospitals. We could make Social Security pay half of what seniors currently receive.  We could legalize paying less, not more to employees.  We could privatize education by firing all teachers and rehiring them at reduced wages, making teaching a minimum wage job. What gets done to teachers then gets continued throughout the entire middle class.

We can stay with what has been torn down and remained broken since Republicans took over in 2000….. OR we can throw our hearts behind at least the possibility of change…. One party does absolutely nothing, except pass tax cuts for the one percent.  The other party vetoes those tax cuts, and tries to negotiate and offer compromises that at least push necessary legislation forward…

These House Republicans have created the least productive Congress ever across the history of the United States of America.  Even the cantankerous Senate has responded responsibly in bipartisan fashion to pass and send important critical issues into the House… only to see them languish, never to even be voted up or down… because if they were,  the votes are there to pass them.

So are you going to vote this year? Are you actually going to get up off your ass, head to the poll, wait in line to cast a vote for a better future, knowing full well that if you don’t, things will continue to get worse?  Or, …are you going to say… “it doesn’t matter whether I vote or not. The powerful will always get their way anyway. ”

You see?  You’ve been put in the exact same position as those boys and young men 239 years ago… Whatever level of action you decide to take, mirrors the level they had to ponder and decide, and will be talked about long after you are dead, like that shot heard around the world… THIS election, not 2012, is the one that REALLY matters.  THIS one decides Congress… We’ve seen it for six years; no president can do anything constructive without at least, a functioning Congress ….  Whereas in the past, Congress has sometimes led and the President has been delegated to either sign or veto, this current Republican House is so dysfunctional it can’t even do that.  Therefore this is a do or die election… Whether you always vote in every election, or you hardly ever vote at all…  this is the one your grandchildren will be asking you about…. This one unequivocally decides their future.  Like those boys or men along the Boston-Concord road 239 years ago….the call has gone out;  it is now in your hands.. Do you fight?  Or just let them win.  What will you do?

 

 

Ken Simpler or Sean Barney?

If nothing major ripples the water, it will all come down to Common Core.

Simpler as being against it… Period.

Barney as being for it!   “Woot, woot, yeah, yeah.. corporate money in MY pocket” sort of being for it…

Like a game between two really equal teams, I expect a lot of defense action the first three quarters and then things open up in the fourth…

(So It’s ok to turn away, and come back when the clock is about to run out… )

Sean Barney: A Little Boy In A Man’s World

That was the consensus of how Sean Barney came across in yesterday’s debate. Perhaps it is the lisp he has, or his youthful choice of adjectives, but, when stacked next to the current treasurer, Barney comes across the weaker choice.

The debate pitted idealism against reality. As a child intent on making the world a better place, the idealism of Barney became too much as the hour progressed. Far too often he was tripped up by Flowers on specifics of the office that in our circle are common knowledge, but apparently Barney didn’t know.

As one sometimes feels sorry when two football teams are extremely mismatched, one feels the same for Barney.

After all, several external events recently undercut Barney’s campaign.

One: The treasurer was honored by the auditors report for being squeaky clean and honest. Unlike Markell (Barney’s old boss) Chip Flowers had no dings on his reporting of finances…

Two: Flowers acted promptly and properly over his deputy’s transgressions. There is no crime in being vicitmized and Barney lost points in trying to tie Flowers to the action of his deputy. Flowers responded to the problem, and currently now, for any future treasurer, it cannot happen again.

Three: Jack Markell’s and Tom Carper’s reputation are the kiss of death. It was ironical for Barney to accuse Flowers of travel violations when Barney’s own boss was accused of the very same, and unlike Flowers, has done nothing to resolve it… Markell had a low level staffer simply brush it off.

Four: The economy of Delaware is not booming. Problems outnumber successes. The Markell Administration is under fire for Fisker, Bloom, TDC, gutting the Coastal Zone Act, Common Core, Smarter Balanced Assessments, a diminishing economy, loss of revenue, casinos going bust, Charter Schools failing, so Barney’s advertising that he was Markell’s POLICY DIRECTOR, is nothing short of an albitross hung around his neck.

Five: It borders incredulous that Barney was unfamiliar with Dave Marvin’s malefeasance as member of the Cash Management Board, and that the single person leading the charge against Chip Flowers, was fined for being dishonest to his investors, and lying and cheating in his disclosures as required by law. Basically Sean Barney was unfamiliar with this man. This completely undercuts Barney’s argument that Chip is flawed because he can’t get “crooks” to like him. That exchange was incredulous to listen to.

Six: Complaining that Flowers was incompetent because he couldn’t get his legislation passed by Markell’s flackeys, was turned on its ear by Allan Loudell who immediately brought up that Markell couldn’t get his 10 cents a gallon passed, barely got his Smarter Balance Assessments passed (had to bribe Greg Lavelle with a spot on Chuck Todd), barely got gun legislation passed, failed to get Flower’s sanctioned last year. If not getting legislation passed is a crime, then Barney’s own boss was guilty of far more…

Seven: After a full hour, one gets an overall sense, that if you want the Delaware way to continue, where a few dictate things behind the scenes and there is no way one can contest or derail it, then Sean Barney is the way to go. One senses that he will not do anything without getting his bosses approval first. “I’ll have to ask the boss.” On the other hand if one feels the elite have run Delaware into the ground, and think a new direction is necessary, one which will improve economic possibilities for all Delawareans not making over $10 million a month, Chip Flowers should be the Democrats choice on the General Election ticket…

It depends who you are, on which one you should vote for. If you are a Greenville elitist, I doubt that you will be happy with Chip Flowers. Heck, if you are one of them, I doubt that you will be happy with anyone. Which in turn, would be good for Delaware….

Democrat Treasures Debate Tonight on WDEL 6-7

As background information, here is the link and below is the copy of the SEC report citing David Marvin currently of Delaware’s Cash Management Board, and fining his firm M & P, $976,000 dollars…

Here is Celia’s account of last years inside dealing, targeting Marvin as the prime whiner in the infamous Cash Management Board pushback… It just dawned on me that Marvin probably handles investments for Markell and Blevins. Which would if true, provide clarity to the mechanizations that took place this past year.

Since the 15 year expiration is about or has already hit, (it was difficult to find), I am posting the entire judgment here, so it will last, if the SEC eliminates it off-line…. Without Further Ado….

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UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

 

INVESTMENT ADVISERS ACT OF 1940
Release No. 1841 / September 30, 1999

 

ADMINISTRATIVE PROCEEDING
File No. 3-10072

 

In the Matter of MARVIN & PALMER ASSOCIATES, INC., DAVID F. MARVIN, MACTHOM ASSOCIATES, INC. and THOMAS E. DUBIS

ORDER INSTITUTING PUBLIC PROCEEDDINGS, MAKING FINDINGS, IMPOSING REMEDIAL SANCTIONS, AND ISSUING CEASE-AND-DESIST ORDER

 

I.

 

The Securities and Exchange Commission (“Commission”) deems it appropriate and in the public interest to institute public administrative proceedings pursuant to Sections 203(e), (f) and (k) of the Investment Advisers Act of 1940 (“Advisers Act”), against Marvin & Palmer Associates, Inc. (“M&P”), David F. Marvin (“Marvin”), MacThom Associates, Inc. (“MacThom”) and Thomas E. Dubis (“Dubis”)(collectively “Respondents”).

 

In anticipation of the institution of these proceedings, each of the Respondents has submitted an Offer of Settlement (“Offer”) to the Commission, 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 in which the Commission is a party, and without admitting or denying the findings contained herein, except for the jurisdiction of the Commission over them and over the subject matter of this proceeding, which is admitted, Respondents consent to the issuance of this Order Instituting Public Proceedings, Making Findings, Imposing Remedial Sanctions, and Issuing Cease-and-Desist Order (“Order”) and to the entry of the findings, cease-and-desist order, and remedial sanctions set forth below.

 

Accordingly, IT IS ORDERED that proceedings pursuant to Sections 203(e), (f) and (k) of the Advisers Act be, and hereby are, instituted.

 

II.

 

On the basis of this Order and the Offers submitted by the Respondents, the Commission makes the following findings:

 

RESPONDENTS

 

A.Marvin & Palmer Associates, Inc., incorporated and located in Wilmington, Delaware, has been registered with the Commission as an investment adviser since August 1986. As of March 11, 1999, M&P had approximately 62 clients and $7.6 billion in assets under management. M&P’s clients are primarily large institutional investors.

 

B.David F. Marvin, age 58, resides in Delaware and is Chairman, Chief Executive Officer and 50 percent owner of M&P. Marvin is the largest shareholder of M&P and is responsible for the overall management of the firm.

 

C.MacThom Associates, Inc., located in Kent, Ohio, was formed in 1996 and is wholly owned and operated by Thomas E. Dubis. The firm was ostensibly formed for the purpose of providing research services to M&P. At no time has MacThom been registered with the Commission as a broker-dealer or an investment adviser.

 

D.Thomas E. Dubis, age 58, resides in Kent, Ohio.

 

INTRODUCTION

 

E.This proceeding involves the failure of M&P, a registered investment adviser, to disclose to its clients its use of at least $920,000 in soft dollars derived from a directed brokerage arrangement with a registered broker-dealer (“Broker”) in violation of provisions of the Advisers Act. The term “soft dollars” generally describes an arrangement whereby an investment adviser uses commission credits generated by securities trades executed in advisory client accounts to pay for research, brokerage, or other products, services, or expenses.

 

THE SOFT DOLLAR ARRANGEMENT

 

F.Since 1991, M&P has maintained a soft dollar arrangement with the Broker. Pursuant to the arrangement, M&P receives $.50 in soft dollar credits for each $1.00 in brokerage commissions directed to the Broker.

 

G.In February 1996, at Marvin’s behest, M&P directed the Broker to begin paying invoices submitted by MacThom, ostensibly for research performed by MacThom for M&P. In fact, MacThom conducted only a small amount of research, with a total value of $63,000 during the relevant time period. Most of the soft dollar payments were used by MacThom to compensate Dubis, MacThom’s principal and a close friend of Marvin, as well as the family of a deceased business associate and friend of Marvin, for their efforts in making introductions and referrals to M&P in its early years. From February 1996 through August 1998, the Broker paid $920,000 to MacThom, and MacThom and Dubis paid $635,000 of this amount to this family. With the exception of the research valued at $63,000, the payments to MacThom provided no benefit to the clients of M&P whose commissions generated the soft dollars used to make the payments.

 

M&P’S FAILURE TO DISCLOSE THE SOFT DOLLAR ARRANGEMENT

 

H.Neither the existence nor the terms of the soft dollar arrangement were disclosed to M&P’s clients in their advisory contracts or otherwise. Furthermore, M&P failed to amend its Form ADV after directing the Broker to begin paying invoices from MacThom and the arrangement was never disclosed in M&P’s Form ADV in effect between February 1996 and July 1998, the period during which the arrangement was in effect.

 

I.M&P failed to disclose the types of products and services it received pursuant to its soft dollar arrangement in response to Item 12 of Part II of the Form ADV, which requires registered investment advisers to describe the factors considered in selecting brokers, including the products, research and services obtained, and any procedures used to direct client transactions to a particular broker in return for products or services.

 

J.From February 1996 to July 1998, M&P’s Form ADV reflected a “no” answer in response to Part II Item 13.A., which asked whether the adviser “receives some economic benefit (including commissions, equipment or non-research services) from a non-client in connection with giving advice to clients.” In view of its soft dollar arrangement with the Broker, and the uses to which the payments were put, this response was false.

 

K.During the period in which the arrangement was in effect, M&P amended its Form ADV on at least eight occasions. Marvin reviewed and signed all but one of M&P’s Forms ADV and amendments filed with the Commission.

 

III.

 

LEGAL ANALYSIS

 

A.An investment adviser has a duty to disclose to clients all material information which might incline an investment adviser consciously or unconsciously to render advice which is not disinterested. SEC v. Capital Gains Research Bureau, Inc., 375 U.S. 180, 191-92 (1963). A fact is material if there is a substantial likelihood that a reasonable investor would consider it important. Basic, Inc. v. Levinson, 485 U.S. 224, 231-32 (1988).

 

B.Soft dollar arrangements are material because of the potential conflict of interest arising from an adviser’s receipt of some benefit in exchange for directing brokerage on behalf of client accounts. See Kingsley, Jennison, McNulty & Morse, Inc., 55 SEC Docket 2434, 2441 (Dec. 23, 1993);Interpretive Release Concerning the Scope of Section 28(e) of the Securities Exchange Act of 1934, Exchange Act Release No. 23170, 35 SEC Docket 905, 909 (Apr. 23, 1986) (“1986 Soft Dollar Release“).

 

C.Moreover, disclosure of soft dollar arrangements is specifically required by Form ADV.¹ See Oakwood Counselors, Inc., Advisers Act Release No. 1614, 63 SEC Docket 2485 (Feb. 10, 1997); S Squared Technology Corp., Advisers Act Release No. 1575, 62 SEC Docket 1560 (August 7, 1996). Form ADV embodies mandatory disclosure requirements to ensure that material information regarding brokerage placement practices and policies are disclosed to investors. See Investment Adviser Requirements Concerning Disclosure, Recordkeeping, Applications for Registration and Annual Filings, Advisers Act Release No. 664 (Jan. 30, 1979); Disclosure of Brokerage Placement Practices By Certain Regulated Investment Companies and Certain Other Issuers, Advisers Act Release No. 665 (Jan. 30, 1979) (“1979 Soft Dollar Release“).

 

D.Items 12 and 13, and Schedule F, of Part II of Form ADV require registrants to disclose soft dollar arrangements with broker-dealers. For investment advisers who have discretionary authority to select the broker-dealers to be used to execute trades in client accounts, Item 12.B. requires a description of the factors considered in selecting brokers and determining the reasonableness of their commissions. Further, Item 12.B. requires advisers to describe the “products, research and services” given to the adviser or related persons, if the value of such “products, research and services” is a factor in selecting broker-dealers.² Item 13 requires an investment adviser to disclose and describe any arrangement whereby it either receives an economic benefit from a non-client in connection with giving advice to clients or directly or indirectly compensates any person for client referrals.³ These disclosure requirements are designed to “assist clients in determining whether to hire an adviser or continue a contract with an adviser, and permit them to evaluate any conflicts of interest inherent in the adviser’s arrangements for allocating brokerage.” Kingsley, 55 SEC Docket at 2441-42; See S Squared, Advisers Act Release No. 1575, 62 SEC Docket 1560.

 

VIOLATIONS OF SECTIONS 206(1) AND 206(2) OF THE ADVISERS ACT

 

E.Sections 206(1) and (2) prohibit an investment adviser from employing any device, scheme, or artifice to defraud clients or from engaging in any transaction, practice or course of business that operates as a fraud on clients. Sections 206(1) and (2) establish a fiduciary duty for investment advisers to act for the benefit of their clients. Transamerica Mortgage Advisers, Inc. v. Lewis, 444 U.S. 11, 17 (1979). An investment adviser’s failure to disclose its soft dollar practices violates Sections 206(1) and 206(2). Renaissance Capital Advisors, Inc., Advisers Act Release No. 1688, 1997 SEC LEXIS 2643 (Dec. 22, 1997) (Sections 206(1) and 206(2));Oakwood, Advisers Act Release No. 1614, 63 SEC Docket 2485 (Sections 206(1) and 206(2)); S Squared, Advisers Act Release No. 1575, 62 SEC Docket 1560 (Section 206(2)). Scienter is an element of a Section 206(1) violation. Steadman v. SEC, 603 F.2d 1126, 1134 (5th Cir. 1979). Proof of scienter is not required to establish a violation of Section 206(2). SEC v. Capital Gains Research Bureau, Inc., 375 U.S. at 195.

 

F.M&P willfully violated Sections 206(1) and (2) by making materially false statements and omissions in M&P’s Form ADV and by failing otherwise to disclose to its clients that M&P was using soft dollar credits to pay non-research expenses.

 

G.Marvin willfully aided and abetted and caused M&P’s violations of Sections 206(1) and (2) by knowingly or recklessly making materially false and omissive statements in M&P’s Form ADV and by failing otherwise to disclose to M&P’s clients that M&P was using soft dollar credits to pay non-research expenses.

 

H.MacThom and Dubis caused M&P’s violations of Sections 206(1) and (2) by knowingly participating in a course of conduct which they knew or should have known was a violation of M&P’s fiduciary duty to its clients.

 

I.As a result of the conduct of M&P, Marvin, MacThom and Dubis, M&P and MacThom were unjustly enriched by $857,000.

 

VIOLATIONS OF SECTION 207 OF THE ADVISERS ACT

 

J.Section 207 of the Advisers Act makes it unlawful for any person willfully to make any untrue statement of material fact in any registration application or report filed with the Commission or willfully to omit to state in any such application or report any material fact required to be stated therein.⁴ A person violates Section 207 by filing false amendments to Form ADV. Stanley Peter Kerry, Advisers Act Release No. 1550, 61 SEC Docket 431 (January 25, 1996).

 

K.M&P’s “no” answer to Item 13.A. in its Form ADV in effect from February 1996 forward was false. M&P was in fact receiving an economic benefit from Broker, a non-client, in the form of soft dollar credits and payments to MacThom for M&P’s benefit. M&P’s response to Item 12.B. in its Form ADV in effect from February 1996 was misleading in that the response failed to disclose that M&P was receiving non-research services from Broker in return for directing client brokerage.

 

L.M&P’s omissions and false and misleading disclosures regarding its soft dollar arrangement were material.

 

M.M&P and Marvin willfully violated Section 207 in that they made untrue statements of material fact in M&P’s Form ADV and failed to disclose in M&P’s Form ADV the existence of the soft dollar arrangement and the non-research services received from the Broker.

 

IV.

 

Based on the foregoing the Commission finds that:

 

A.M&P willfully violated Sections 206(1), 206(2) and 207 of the Advisers Act.

 

B.Marvin willfully violated Section 207 of the Advisers Act and willfully aided and abetted and caused M&P’s violations of Sections 206(1) and 206(2) of the Advisers Act.

 

C.MacThom and Dubis caused M&P’s violations of Sections 206(1) and 206(2) of the Advisers Act.

 

V.

 

In view of the foregoing, the Commission deems it appropriate to accept the Respondents’ Offers of Settlement.

 

Accordingly, IT IS HEREBY ORDERED that:

 

A.M&P shall be, and hereby is, censured;

 

B.M&P shall cease and desist from committing or causing any violation and any future violation of Sections 206(1), 206(2) and 207 of the Advisers Act;

 

C.M&P and MacThom shall, jointly and severally, within 30 days of the entry of this Order, pay disgorgement and prejudgment interest in the total amount of $976,980 to the United States Treasury. Such payment shall be: (A) made by United States postal money order, certified check, bank cashier’s check or bank money order; (B) made payable to the Securities and Exchange Commission; (C) hand-delivered or mailed to the Comptroller, Securities and Exchange Commission, Operations Center, 6432 General Green Way, Alexandria, Stop 0-3, VA 22312; and (D) submitted under cover letter that identifies M&P and MacThom as Respondents in these proceedings, and the file number of these proceedings, a copy of which cover letter and money order or check shall be sent to Ronald C. Long, District Administrator, Philadelphia District Office, Securities and Exchange Commission, 601 Walnut Street, Suite 1120E, Philadelphia, PA 19106;

 

D.M&P shall, within 30 days of the entry of this Order, pay a civil money penalty in the amount of $50,000 to the United States Treasury. Such payment shall be: (A) made by United States postal money order, certified check, bank cashier’s check or bank money order; (B) made payable to the Securities and Exchange Commission; (C) hand-delivered or mailed to the Comptroller, Securities and Exchange Commission, Operations Center, 6432 General Green Way, Alexandria, Stop 0-3, VA 22312; and (D) submitted under cover letter that identifies M&P as a Respondent in these proceedings, and the file number of these proceedings, a copy of which cover letter and money order or check shall be sent to Ronald C. Long, District Administrator, Philadelphia District Office, Securities and Exchange Commission, 601 Walnut Street, Suite 1120E, Philadelphia, PA 19106;

 

E.M&P shall comply with its undertakings as specified in its Offer of Settlement to perform and implement the following:

 

1.Within 60 days of the entry of this Order, M&P will revise its procedures manual to include a section setting forth policies and procedures regarding soft dollar arrangements with broker-dealers. Included in these procedures will be the requirement that all soft dollar arrangements be approved by in-house counsel employed at M&P. M&P will hold a mandatory meeting with its employees to review policies and procedures including those relating to soft dollar arrangements. Attendance at the meeting will be recorded and a copy maintained in the files of M&P.

 

2.Within 30 days of the entry of this Order, M&P will file with the Commission and provide each of its advisory clients an amended Form ADV disclosing all material terms of any soft dollar arrangement it has with any broker-dealer;

 

3.Within 30 days of the entry of this Order, M&P will provide a copy of this Order to all of its current clients;

 

4.Within 60 days of the entry of this Order, M&P will file an affidavit with the Commission’s staff, addressed to the attention of the District Administrator of the Commission’s Philadelphia District Office, 601 Walnut Street. Suite 1120E, Philadelphia, PA 19106, setting forth the details of its compliance with the undertakings set forth in subparagraphs E.1., 2. and 3. above;

 

5.For a period of one year after the entry of this Order, M&P will provide a copy of this Order to all of its prospective clients;

 

6.One year from the entry of this Order, M&P will file an affidavit with the staff of the Commission certifying its compliance with subparagraph E.5. above.

 

IT IS FURTHER ORDERED that:

 

F. Marvin shall be, and hereby is, censured;

 

G.Marvin shall cease and desist from committing or causing any violation and any future violation of Sections 206(1), 206(2) and 207 of the Advisers Act;

 

H.Marvin shall, within 30 days of the entry of this Order, pay a civil money penalty in the amount of $25,000 to the United States Treasury. Such payment shall be: (A) made by United States postal money order, certified check, bank cashier’s check or bank money order; (B) made payable to the Securities and Exchange Commission; (C) hand-delivered or mailed to the Comptroller, Securities and Exchange Commission, Operations Center, 6432 General Green Way, Alexandria, Stop 0-3, VA 22312; and (D) submitted under cover letter that identifies Marvin as a Respondent in these proceedings, and the file number of these proceedings, a copy of which cover letter and money order or check shall be sent to Ronald C. Long, District Administrator, Philadelphia District Office, Securities and Exchange Commission, 601 Walnut Street, Suite 1120E, Philadelphia, PA 19106;

 

I.MacThom and Dubis shall cease and desist from causing any violation and any future violation of Sections 206(1) and 206(2) of the Advisers Act.

 

By the Commission.

Jonathan G. Katz
Secretary

 

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FOOTNOTES

 

1	The “safe harbor” provided by Section 28(e) of the Securities Exchange Act of 1934 (“Exchange Act”) does not excuse an investment adviser from these disclosure obligations. The safe harbor protects an investment adviser only from charges of breach of fiduciary duty for failing to obtain the lowest available commission rate where the amount of commission is reasonable in relation to the value of brokerage and research services provided. 1986 Soft Dollar Release, 35 SEC Docket at 907.
2	See 1986 Soft Dollar Release, 35 SEC Docket at 909. There is a presumption that receipt of non-research and non-brokerage products or services, except where nominally valued, is a factor in the selection of brokers. 1979 Soft Dollar Release at n.6.
3	The 1986 Soft Dollar Release noted the relevance of Form ADV, Part II, Item 13 to soft dollar disclosure. 35 SEC Docket at 909 n.32.
4	Section 204 of the Advisers Act and Rule 204-1 thereunder require periodic filing and amendment of Forms ADV by investment advisers. Pursuant to Rule 204-1(d), a Form ADV or an amendment thereto is a “report” within the meaning of Section 207.

 

http://www.sec.gov/litigation/admin/ia-1841.htm

 

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Modified:10/01/1999

 

Debate Follow Up

The treasurers debated today. Here is one account.… Here another and better account…

Debates at the small end of the political spectrum are fun to watch. Like two fat ladies wrestling in mud, their blows are thrown with such earnest, but hit wildly off their mark… Still it’s enough spectacle making it hard for one to turn away….

Overall, it was a draw… One’s arguments will resonate if you are already in agreement with those arguments. One’s arguments will slide like Gordan Ramsey’s food off of Teflon, if you aren’t…. What you believed when you came in, is what you believed when you came out….

One thing was clear, however. if you support the upper class or 1%… Barney like Carper and Markell and Carney, is your man. If you would rather give an edge to the 99%, stick with Flowers…..