Bts Asset Management Inc

Allegations: ON OCTOBER 29, 2012, BTS ASSET MANAGEMENT OFFERED, AND THE SEC AGREED TO ACCEPT, A SETTLEMENT IN CONNECTION WITH AN ORDER INSTITUTING PROCEEDINGS, MAKING FINDINGS, IMPOSING REMEDIAL SANCTIONS AND ISSUING CEASE AND DESIST ORDERS (ADMINISTRATIVE PROCEEDING FILE NO. 3-15802) REGARDING ALLEGED VIOLATIONS OF SECTION 206(4) OF THE ADVISERS ACT AND RULE 206(4)-1(A)(5) THEREUNDER (THE "SETTLEMENT ORDER"). SEC ALLEGED SOME ADVERTISEMENTS FOR THE BTS HIGH YIELD PROGRAM ("HYP") THAT CLAIMED HYP HAD "NO DOWN YEARS" WERE MATERIALLY MISLEADING BECAUSE THEY FAILED TO DISCLOSE WITH SUFFICIENT PROMINENCE AND DETAIL THAT, IN 2004, A SIGNIFICANT NUMBER OF HYP CLIENTS WOULD HAVE EXPERIENCED INVESTMENT RESULTS THAT WERE MATERIALLY DIFFERENT (I.E. THEY HAD A DOWN YEAR) FROM THE RESULTS PORTRAYED IN THE MODEL, WHICH APPLIED HYP'S BUY/SELL SIGNALS TO THE FUNDS DESCRIBED IN THE ADVERTISEMENTS. AS PART OF THE SETTLEMENT, BTS NEITHER ADMITTED OR DENIED THE ALLEGATIONS. Status: Final Sanction Detail: BTS PAID A $200,000 FINE, REQUIRED TO POST A LINK TO THE SETTLEMENT ORDER ON FRONTPAGE OF WEBSITE FOR SIX MONTHS, FURNISH A COPY OF ADV TO NEW AND EXISTING CLIENTS, AND HIRE AN INDEPENDENT COMPLIANCE CONSULTANT TO REVIEW ADVERTISING POLICIES AND PROCEDURES, WITH A FINAL REPORT DUE WITHIN 12 MONTHS OF ISSUANCE OF THE SETTLEMENT ORDER. Summary: BTS PAID A $200,000 FINE, REQUIRED TO POST A LINK TO THE SETTLEMENT ORDER ON FRONTPAGE OF WEBSITE FOR SIX MONTHS, FURNISH A COPY OF ADV TO NEW AND EXISTING CLIENTS, AND HIRE AN INDEPENDENT COMPLIANCE CONSULTANT TO REVIEW ADVERTISING POLICIES AND PROCEDURES, WITH A FINAL REPORT DUE WITHIN 12 MONTHS OF ISSUANCE OF THE SETTLEMENT ORDER.

Allegations: ON SEPTEMBER 11TH, 2023, BTS OFFERED, AND THE SEC AGREED TO ACCEPT, A SETTLEMENT REGARDING ALLEGED VIOLATIONS OF SECTION 206(4) OF THE ADVISERS ACT AND RULE 206(4)-1(D) THEREUNDER. THE SEC ALLEGED THAT BTS ADVERTISED HYPOTHETICAL PERFORMANCE ON ITS PUBLIC WEBSITE WITHOUT ADOPTING AND IMPLEMENTING POLICIES AND PROCEDURES REASONABLY DESIGNED TO ENSURE THAT THE HYPOTHETICAL PERFORMANCE WAS RELEVANT TO THE LIKELY FINANCIAL SITUATION AND INVESTMENT OBJECTIVES OF THE INTENDED AUDIENCE. AS PART OF THE SETTLEMENT WITH THE SEC, BTS AGREED TO PAY A CIVIL MONEY PENALTY IN THE AMOUNT OF $135,000 AND TO EVALUATE, UPDATE, AND REVIEW BTS' APPLICABLE POLICIES AND PROCEDURES CONCERNING ADVERTISEMENTS THAT INCLUDE HYPOTHETICAL PERFORMANCE. AS PART OF THE SETTLEMENT, BTS NEITHER ADMITTED NOR DENIED THE ALLEGATIONS. Status: Final Sanction Detail: THE SETTLEMENT WAS PAID WITHIN 30 DAYS OF ENTRY Summary: ON SEPTEMBER 11TH, 2023, BTS OFFERED, AND THE SEC AGREED TO ACCEPT, A SETTLEMENT REGARDING ALLEGED VIOLATIONS OF SECTION 206(4) OF THE ADVISERS ACT AND RULE 206(4)-1(D) THEREUNDER. THE SEC ALLEGED THAT BTS ADVERTISED HYPOTHETICAL PERFORMANCE ON ITS PUBLIC WEBSITE WITHOUT ADOPTING AND IMPLEMENTING POLICIES AND PROCEDURES REASONABLY DESIGNED TO ENSURE THAT THE HYPOTHETICAL PERFORMANCE WAS RELEVANT TO THE LIKELY FINANCIAL SITUATION AND INVESTMENT OBJECTIVES OF THE INTENDED AUDIENCE. AS PART OF THE SETTLEMENT WITH THE SEC, BTS AGREED TO PAY A CIVIL MONEY PENALTY IN THE AMOUNT OF $135,000 AND TO EVALUATE, UPDATE, AND REVIEW BTS' APPLICABLE POLICIES AND PROCEDURES CONCERNING ADVERTISEMENTS THAT INCLUDE HYPOTHETICAL PERFORMANCE. AS PART OF THE SETTLEMENT, BTS NEITHER ADMITTED NOR DENIED THE ALLEGATIONS.