U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20972 / March 25, 2009
Securities and Exchange Commission v. The Nutmeg Group, LLC, et al., Case No. 09CV1775 (N.D. IL)
SEC OBTAINS EMERGENCY RELIEF AGAINST THE NUTMEG GROUP, LLC, A CHICAGO-AREA INVESTMENT ADVISER, AND TWO OF ITS PRINCIPALS FOR ALLEGED FRAUD AND CUSTODIAL VIOLATIONS
The Securities and Exchange Commission announced today that on March 24, it obtained emergency relief against investment adviser The Nutmeg Group, LLC, and its principals Randall and David Goulding. In its complaint, filed March 23, the Commission alleges that Nutmeg, which controls and provides investment advice to 13 investment funds, and advises two additional investment funds, has misappropriated client assets, made misrepresentations to its clients, failed to comply with its custodial obligations and failed to keep required books and records.
Based on the Commission's allegations, the Honorable William J. Hibbler of the United States District Court for the Northern District of Illinois entered an order (TRO) temporarily enjoining Nutmeg from violating Sections 204, 206(1), 206(2), and 206(4) of the Investment Advisers Act of 1940 (the "Advisers Act") and Rules 204-2, 206(4)-2, and 206(4)-8 thereunder. The TRO also temporarily enjoins Randall Goulding from violating Section 206(4) of the Advisers Act and Rule 206(4)-8 thereunder, aiding and abetting violations of Sections 206(1) and (2) and Section 206(4) of the Advisers Act and Rules 204-2, 204-2, 206(4)-2 and 206(4)-8 thereunder, and David Goulding from aiding and abetting violations of Sections 206(1) and (2) and 206(4) of the Advisers Act and Rules 206(4)-2, 206(4)-8 thereunder. Additionally, the TRO freezes Nutmeg's assets.
http://www.sec.gov/litigation/litreleases/2009/lr20972.htm
