An investment advisor who allegedly misappropriated profits from an investment fund that offered investors exposure to pre-IPO shares in Palantir Technologies, Inc. is being sanctioned in a settlement with the U.S. Securities and Exchange Commission (SEC).
The SEC charged Ivan Moad — the managing member and sole control person of Moma Fund II, LLC — for allegedly defrauding investors in the fund, and breaching his fiduciary duty to those investors.
According to the SEC’s order, between February 2019 and September 2020, Moad raised approximately US$1.3 million from investors though the Moma fund, to purchase pre-IPO shares of Palantir. After the IPO, the regulator said that Moad sold some of the shares — using some of the proceeds to pay investor redemptions, but also “transferring funds to his personal account.”
Ultimately, the SEC alleged that Moad misappropriated over US$2.1 million for his own use, after accounting for amounts that he was entitled to collect from the fund, and the amounts that he returned to investors.
Without admitting the order’s findings, Moad consented to the SEC’s order, which requires him to disgorge US$2.1 million, plus US$700,000 in interest, and to pay a civil penalty of US$236,451, along with other sanctions.