The former CEO and co-founder of investment firm F-Squared Investments, Inc. was found liable for violating federal securities laws in relation to allegations he misled investors about the performance of an investment strategy.
In a 2014 Complaint filed in the U.S. District Court for the District of Massachusetts, the SEC charged Howard Present with falsely claiming that the "AlphaSector" product's performance record had not been created through back-testing. The SEC said that Mr. Present "knew or was reckless in not knowing" that the claims were false. F-Squared sold AlphaSector to an investment advisory firm and eventually bought it back. That firm, Navellier & Associates, was recently charged by the SEC for misleading clients about AlphaSector's performance (see previous coverage).
According to the SEC, Mr. Present also lied in filings with the SEC. As a result of his misconduct, Mr. Present was found liable for violating Investment Advisers Act Sections 207, 206(1), (2) and (4), and Rules 206(4)-8 and 206(4)-1.
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