SEC fines and censures Talimco for manipulating real estate auction

SEC fines and censures Talimco for manipulating real estate auction
RIA to pay $325,000 in penalties; former COO Grant Gardner Rogers fined $65,000
MAR 18, 2019

The Securities and Exchange Commission has charged Talimco, a New York-based registered investment adviser, and Grant Gardner Rogers, its former chief operating officer, with manipulating a commercial real estate auction to favor one client over another. Talimco consented to a cease-and-desist order, a censure, disgorgement of its fees of $74,000 plus prejudgment interest of $8,758.80 and a penalty of $325,000. Mr. Rogers, who also neither admitted nor denied the findings, consented to a cease-and-desist order, a 12-month industry suspension, and a $65,000 fine. (More:​ SEC bars unregistered adviser who pled guilty to securities fraud) According to the SEC's order, in or about April 2015 while selling a commercial real estate asset on behalf of a collateralized debt obligation client, Talimco and Mr. Rogers tried to acquire the asset for another client, a private fund. Rather than seek out multiple bidders, the SEC said that Mr. Rogers used the firm's affiliated private fund client for one bid and convinced two unwilling bidders to participate in the auction by giving assurances that the bidders would not win the auction. As a result, Talimco's private fund client was the highest bidder and acquired the asset, only to then later sell it for a substantial profit. (More:​ SEC bars New Jersey RIA over securities, adviser fraud) "By rigging the auction, Talimco and Mr. Rogers failed to fulfill their fiduciary duty to their client," said Daniel Michael, chief of the SEC enforcement division's complex financial instruments unit.

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