Connecticut

On February 6, 2024, the Banking Commissioner entered a Consent Order with respect to GlennCap LLC d/b/a Glenn Capital LLC, a Connecticut registered investment adviser located at 165 West Putnam Road, Greenwich, Connecticut. Also named was Jonathan Vincent Glenn, sole member of the firm. The Consent Order alleged that the Respondents violated the antifraud provisions in Section 36b-5 of the Connecticut Uniform Securities from January 2020 to March 2022. Specifically, Glenn, on behalf of and as an agent of Glenn Capital, engaged in "cherry picking" which is the practice of allocating favorable trades specifically to certain accounts, often to the benefit of the investment adviser, while allocating the less favorable trades to clients. Respondent received $2,743,616 in illgotten gains from the cherry picking and the resulting increase in performance fees attributable to accounts in which gains were assigned more favorably. The Respondents were also the subject of a Securities and Exchange Commission order requiring them to disgorge $2,743,616 in ill-gotten gains to investors; and barring them from securities-related activity.

Consent

Bar (Temporary/Time Limited)

Broker-dealer, agent, investment adviser, investment adviser agent

7 years

2/6/2024

2/6/2031

Revocation

The Consent Order directed Respondents to cease and desist from regulatory violations, revoked the firm's Connecticut investment adviser registration; and permanently barred the firm from transacting business in Connecticut as a broker-dealer, investment adviser or any other entity requiring a license or registration from the Commissioner. The Consent Order also revoked Jonathan Vincent Glenn's investment adviser agent registration and barred him for seven years from transacting business in Connecticut as a broker-dealer, agent, investment adviser or any other capacity requiring a license or registration from the Commissioner.

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

The Securities and Exchange Commission ("Commission") deems it appropriate and in the public interest that public administrative and cease-and-desist proceedings be, and hereby are, instituted pursuant to Section 8A of the Securities Act of 1933 ("Securities Act"), Section 21C of the Securities Exchange Act of 1934 ("Exchange Act"), Sections 203(e), 203(f), and 203(k) of the Investment Advisers Act of 1940 ("Advisers Act"), and Section 9(b) of the Investment Company Act of 1940 ("Investment Company Act") against GlennCap LLC ("GlennCap") and Jonathan Vincent Glenn ("Glenn") (collectively, "Respondents"). The Commission finds that from at least January 2020 to March 2022, GlennCap, acting through Glenn, its sole owner and principal, engaged in undisclosed "cherry-picking," a practice of fraudulently allocating profitable trades to favored accounts at the expense of other advisory clients. Glenn allocated a disproportionate number of trades with positive first-day returns to accounts belonging to certain favored clients, GlennCap (which Glenn owns), and another account that Glenn controlled, while allocating a disproportionate number of trades with negative first-day returns to other client accounts. Glenn accomplished this by executing block trades in GlennCap's omnibus brokerage account and then waiting until later in the day, after he could see whether the positions had increased or decreased in value, to allocate the trades to either favored or disfavored accounts. Respondents also made false and misleading statements concerning their trading practices in GlennCap's Forms ADV, Part 2A ("Brochures"), which were provided to clients and prospective clients. By virtue of this conduct, Respondents willfully violated Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Advisers Act.

Order

Bar (Permanent)

association with a broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or NRSRO

Indefinite

9/14/2023

Cease and Desist

Civil and Administrative Penalty(ies)/Fine(s)

$500,000.00

Disgorgement

$2,743,616.00

Monetary Penalty other than Fines

$251,357.00

Prohibition