Anson Funds Management Lp

Allegations: THE SEC ALLEGED THAT ANSON FUNDS MANAGEMENT ("ANSON FUNDS") AND ANSON ADVISORS INC. ("ANSON ADVISORS") VIOLATED SECTION 206(4) OF THE ADVISERS ACT AND RULE 206(4)-8(A)(1) AND (2) THEREUNDER BY OMITTING FROM THE PRIVATE PLACEMENT MEMORANDUM OF ONE OF THEIR ADVISORY CLIENT FUNDS (THE "PPM") THEIR AGREEMENTS WITH AND PAYMENTS TO SHORT PUBLISHERS, WHICH RENDERED STATEMENTS ABOUT ANSON FUNDS' SHORT STRATEGY MISLEADING. THE SEC ALSO ALLEGED THAT ANSON FUNDS VIOLATED SECTION 206(4) OF THE ADVISERS ACT AND RULE 204-2(A)(1) AND (2) THEREUNDER BY INACCURATELY RECORDING THE PAYMENTS FOR THE BENEFIT OF A SHORT PUBLISHER IN ITS JOURNAL AND LEDGERS AS PAYMENTS TO A THIRD-PARTY INTERMEDIARY FOR RESEARCH SERVICES, WHEN IN FACT THEY WERE TO THE SHORT PUBLISHER FOR TRADING PROFITS. FINALLY, THE SEC ALLEGED THAT ANSON FUNDS VIOLATED SECTION 206(4) OF THE ADVISERS ACT AND RULE 206(4)-7 THEREUNDER BY FAILING TO IMPLEMENT ITS COMPLIANCE POLICY WHEN IT APPROVED AND PAID THE SHORT PUBLISHER THROUGH THE THIRD-PARTY INTERMEDIARY, AND WHEN IT OMITTED FROM THE DESCRIPTION OF ITS SHORT STRATEGY IN THE PPM ITS PRACTICE OF WORKING WITH SHORT PUBLISHERS AND PAYING THEM A SHARE OF THE FUND CLIENT'S TRADING PROFITS. Status: Final Sanction Detail: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, (I) ANSON FUNDS AGREED TO CEASE AND DESIST FROM VIOLATING SECTIONS 204 AND 206(4) OF THE ADVISERS ACT AND RULES 204-2(A), 206(4)-7 AND 206(4)-8 THEREUNDER, (II) ANSON ADVISORS AGREED TO CEASE AND DESIST FROM VIOLATING SECTION 206(4) OF THE ADVISERS ACT AND RULE 206(4)-8 THEREUNDER, (III) ANSON FUNDS AND ANSON ADVISORS AGREED TO A CENSURE, (IV) ANSON ADVISORS AGREED TO PAY A $1,000,000 CIVIL MONEY PENALTY, WHICH WILL BE TIMELY PAID, AND (IV) ANSON FUNDS AGREED TO PAY A $1,250,000 CIVIL MONEY PENALTY, WHICH WAS PAID ON JUNE 14, 2024. Summary: ON JUNE 11, 2024, ANSON FUNDS AND ANSON ADVISORS, WITHOUT ADMITTING OR DENYING THE FINDINGS OR CONCLUSIONS THEREIN, ENTERED INTO A SETTLEMENT WITH THE SEC. THE SEC APPROVED THE SETTLEMENT IN ITS ORDER INSTITUTING ADMINISTRATIVE AND CEASE-AND-DESIST- PROCEEDINGS, PURSUANT TO SECTIONS 203(E) AND 203(K) OF THE INVESTMENT ADVISERS ACT OF 1940, MAKING FINDINGS, AND IMPOSING REMEDIAL SANCTIONS AND A CEASE-AND-DESIST ORDER, INCLUDING THE FOLLOWING TERMS AND CONDITIONS. ANSON FUNDS AGREED TO CEASE AND DESIST FROM VIOLATING SECTIONS 204 AND 206(4) OF THE ADVISERS ACT AND RULES 204-2(A), 206(4)-7 AND 206(4)-8 THEREUNDER; TO A CENSURE; AND TO PAY A $1,250,000 CIVIL MONEY PENALTY, WHICH WAS PAID ON JUNE 14, 2024. ANSON ADVISORS AGREED TO CEASE AND DESIST FROM VIOLATING SECTION 206(4) OF THE ADVISERS ACT AND RULE 206(4)-8 THEREUNDER; TO A CENSURE; AND TO PAY A $1,000,000 CIVIL MONEY PENALTY, WHICH WAS PAID ON JUNE 14, 2024.