Oppenheimer exec settles SEC charges

Former Oppenheimer & Company executive, Brian Williamson, today accepted his punishment for misrepresenting the valuation of a private equity fund of funds by settling charges with the Securities and Exchange Commission (SEC).

Williamson has agreed with the SEC to be barred from the securities industry (for a minimum of two years) and pay a $100,000 penalty.

Administrative proceedings against Williamson began last August after the SEC alleged he disseminated information falsely claiming the valuation was based on mark to market estimates received from managers of the underlying funds. But Williamson actually valued the fund’s largest investment “at a significant markup” to those manager’s fair value estimates, the SEC said in a statement.

Williamson, who managed the fund of funds, also sent marketing materials to potential fund investors reporting a misleading internal rate of return (IRR) that failed to deduct the fund’s fees and expenses. Furthermore, he made false and misleading statements to investor consultants and others in an effort to cover up his fraud.

“Investors rely on truthful and complete disclosures about valuation methodologies and fund fees and expenses, especially when committing to a long-term private equity investment,” said in a statement Julie Riewe, co-chief of the SEC Enforcement Division’s Asset Management Unit.

Last year, Oppenheimer agreed to pay $2.8 million in a settlement of related charges.

In an emailed statement Oppenheimer said: “Mr. Williamson left the company in December 2011. Oppenheimer settled all issues related to this matter in May of last year.”