Wilmington Trust Investment Management Llc

Allegations: THE ORDER ALLEGES THAT BETWEEN FEBRUARY AND AUGUST 2020 WTIM (I) DID NOT PROVIDE ADEQUATE DISCLOSURE TO CLIENTS IN WTIM'S PORTFOLIO ARCHITECT WRAP FEE PROGRAM (THE "WRAP FEE PROGRAM") CONCERNING ITS INVESTMENTS IN NO-TRANSACTION FEE MUTUAL FUND SHARE CLASSES AND CERTAIN ASSOCIATED CONFLICTS OF INTEREST; (II) INVESTED CERTAIN WRAP FEE PROGRAM CLIENTS IN HIGHER-COST MUTUAL FUND SHARE CLASSES THAN WERE OTHERWISE AVAILABLE; (III) AVOIDED CERTAIN TRANSACTION FEES FROM A NO-TRANSACTION FEE PROGRAM OFFERED BY ITS CLEARING FIRM BY INVESTING ASSETS IN THE HIGHER-COST MUTUAL FUND SHARE CLASSES; (IV) BREACHED ITS DUTY OF CARE, INCLUDING ITS DUTY TO SEEK BEST EXECUTION, BY CAUSING WRAP FEE PROGRAM CLIENTS TO INVEST IN CERTAIN SHARE CLASSES WHEN SHARE CLASSES OF THE SAME FUNDS, OR OTHER SIMILAR FUNDS, THAT PRESENTED A MORE FAVORABLE VALUE WERE AVAILABLE; AND (V) FAILED TO ADOPT AND IMPLEMENT WRITTEN COMPLIANCE POLICIES AND PROCEDURES REASONABLY DESIGNED TO PREVENT VIOLATIONS OF THE INVESTMENT ADVISERS ACT OF 1940 ("ADVISERS ACT") AND THE RULES THEREUNDER IN CONNECTION WITH ITS MUTUAL FUND SHARE CLASS SELECTION PRACTICES. THE ORDER FINDS THAT, IN CONNECTION WITH THE ISSUES DESCRIBED ABOVE, WTIM VIOLATED SECTIONS 206(2) AND 206(4) OF THE ADVISERS ACT AND RULE 206(4)-7 THEREUNDER. Status: Final Sanction Detail: THE ORDER REQUIRES THAT WTIM (I) CEASE AND DESIST FROM COMMITTING OR CAUSING ANY VIOLATIONS OR FUTURE VIOLATIONS OF SECTIONS 206(2) AND 206(4) OF THE ADVISERS ACT AND RULE 206(4)-7 THEREUNDER; (II) IS CENSURED; (III) PAY DISGORGEMENT OF $999,559, PREJUDGMENT INTEREST OF $77,588 AND A CIVIL PENALTY OF $250,000 FOR A TOTAL OF $1,327,147; AND (IV) COMPLY WITH UNDERTAKINGS TO NOTIFYING AFFECTED INVESTORS OF THE SETTLEMENT TERMS. REQUIRED DISGORGEMENT, PREJUDGMENT INTEREST AND CIVIL PENALTY AMOUNTS WERE PAID OCTOBER 12, 2023. Summary: ON OCTOBER 10, 2023, THE SECURITIES AND EXCHANGE COMMISSION ("COMMISSION") ANNOUNCED IT HAD ENTERED INTO A SETTLEMENT WITH WTIM CONCERNING SHARE CLASS SELECTION IN WTIM'S WRAP FEE PROGRAM. AS PART OF THE SETTLEMENT, WTIM HAS CONSENTED TO, WITHOUT ADMITTING OR DENYING THE FINDINGS THEREIN, SOLELY FOR THE PURPOSE OF PROCEEDINGS BROUGHT BY OR ON BEHALF OF THE COMMISSION OR TO WHICH THE COMMISSION IS A PARTY, THE ENTRY OF AN ORDER INSTITUTING CEASE-AND-DESIST PROCEEDINGS, MAKING FINDINGS, AND IMPOSING A CEASE-AND-DESIST ORDER ("ORDER") AGAINST WTIM, PURSUANT TO SECTION 203(E) AND 203(K) OF THE ADVISERS ACT. THE ALLEGATIONS, DISPOSITIONS, FINDINGS, AND SANCTIONS OF THE ORDER ARE DESCRIBED ABOVE IN ITEMS 7 AND 12.