SEC Rule 206(1) – Global Relay Intelligence & Practice

SEC Rule 206(1)

Prohibits any device or scheme that might be used to defraud a client or prospective client.

Rule Overview

Jurisdiction: United States

Regulator: SEC

Topic: Fraud

Overview

Latest News

Prohibits investment adviser from employing, directly or indirectly, any:

device
scheme
artifice

to defraud any client or prospective client.

The prohibition covers the use of “mails” as well as any “means or instrumentality of interstate commerce”.

Latest News More on IAA 1940 Rule 206(1)

Enforcement

SEC fines Momentum Advisors, two officers $500,000+ over fiduciary breaches

March 12, 2025

Momentum Advisors LLC, along with its former COO and CCO, were charged with violations related to the misuse of portfolio company assets.

Alexander Barzacanos2 min read
Enforcement

Final judgements for Ponzi scheme defendants Robert Allen Stanford and others

February 25, 2025

Final judgments in this action were against individuals and entities charged with perpetrating a massive $8 billion Ponzi scheme.

Julie DiMauro1 min read
Enforcement

Trading firm dinged for using buzzwords about purported AI capabilities

October 15, 2024

The SEC also accused the pair of lying to investors about Rimar’s assets under management.

Julie DiMauro3 min read
Enforcement

New Jersey asset management firm CCO pleads guilty to $401m fraud

November 6, 2023

With SEC and DOJ charges pending, we examine the case and assess the implications of the CCO's characterization as a gatekeeper.

Julie DiMauro3 min read