SEC Charges Galois Capital for Custody Rule Violations, $225,000 Settlement

Sep 3, 2024, 04:13 PM

The U.S. Securities and Exchange Commission (SEC) has charged and settled with Galois Capital Management LLC, a former registered investment adviser based in Florida, for violations of the Investment Advisers Act's Custody Rule. The SEC alleges that the crypto-focused Galois Capital failed to properly safeguard client assets, including cryptocurrency assets, by holding them in non-qualified custodians and misleading investors about redemption notice periods. The firm has agreed to a settlement that includes a $225,000 civil penalty. The charges are linked to FTX-related custody issues.