FINRA

Without admitting or denying the findings, Miller consented to the sanction and to the entry of findings that he refused to appear for on-the-record testimony requested by FINRA in connection with its investigation into the suitability of Miller's investment recommendations.

Acceptance, Waiver & Consent(AWC)

Bar (Permanent)

All capacities

Indefinite

7/27/2023

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 15(b) 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 PeachCap Tax & Advisory, LLC (“PCTA”) and David H. Miller (“Miller”) (collectively, “Respondents”). The Commission finds that these proceedings arise from violations of the federal securities laws by Miller and his SEC-registered investment advisory firm, PCTA. First, between May 2016 and October 2016, Miller offered and sold to certain of his advisory clients and others over $4.6 million in limited partnership interests in The Pessego Long Short Fund, LP (the “Fund”), a hedge fund formed by Miller in April 2016. The Fund’s offering documents and other materials provided to prospective investors claimed that the Fund sought to “generate attractive risk-adjusted returns across all market environments while preserving capital,” and that the Fund “utilize[d] a fundamental long/short equity approach that targets a low net exposure as its principal investment strategy.” In reality, however, the Fund engaged in risky trading from the outset that was inconsistent with its stated objectives and strategies. Moreover, in soliciting investors, Miller recommended the Fund to certain PCTA advisory clients, including some clients for whom the Fund was an unsuitable investment. The Fund, which began trading in May 2016, lost more than 90 percent of its value before closing in December 2017. Second, between May 2017 and June 2018, PCTA engaged in 492 principal trades with 6 advisory clients without providing the requisite transaction-specific notice or obtaining consent. PCTA also did not adopt and implement written compliance policies and procedures reasonably designed to prevent violations of the federal securities laws in connection with these principal trades. Finally, PCTA did not adopt written compliance policies and procedures regarding volatility-linked exchange-traded products, which resulted in PCTA’s investment adviser representatives (“IARs”) using their discretionary authority over client accounts to buy and hold a complex leveraged exchange traded fund (“Leveraged ETF”) for retail clients for time periods that were inconsistent with the purpose of the product as described in its offering materials, subjecting its clients to unreasonable risk of loss.

Order

Bar (Permanent)

see comments

Indefinite

12/22/2021

participating in any offering of a penny stock

Indefinite

12/22/2021

Cease and Desist

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

$65,000.00

Prohibition

Undertaking

Breach of fiduciary duty

$5,001.00

Claimants allege an unsuitable investment strategy beginning in 2011.

$24,000.00

Claimant was unhappy with the performance of their investment with an affiliated firm.

$187,125.00

Rep & firm deny liability to this claim.

Claimant alleges sales practice violations related to mismanagement of her accounts from October 2015 to early 2017.

$27,936.14

$5,000.00

Mr. Miller was not the representative of record on claimant's accounts, and Claimant was not a customer of PeachCap Securities, Inc. The firm and representative vigorously deny the allegations included in the claim and entered into settlement to avoid cost and distraction of protracted litigation.

Customer was unhappy with investment performance. Firm and Rep vigorously deny liability to these claims.

$1,200,000.00

$550,000.00

Rep was not required to contribute to the settlement amount. Rep & Firm deny any liability to this claim and made a business decision to come to a settlement in order to avoid costs and distraction of litigated proceedings.

Customer was unhappy with the performance of his investment with an affiliated firm. Rep & Firm vigorously deny any liability to these claims.

$662,663.00

$455,000.00

Rep & Firm deny any liability to this claim.

Customer was unhappy with the performance of his investment with an affiliated firm. Rep & Firm vigorously deny any liability to these claims and made a business decision to come to a settlement to avoid costs and distractions of litigated proceedings. Activity occurred from 2016 to 2018.

$150,000.00

$50,000.00

PeachCap Securities Inc was a party to the settlement due to affiliated firm association. Settlement was paid by affiliated firm and not by PeachCap Securities Inc. Rep was not required to contribute to the settlement amount. Rep & Firm deny any liability to this claim and made a business decision to come to a settlement in order to avoid costs and distraction of litigated proceedings.

Customer was unhappy with the performance of his investment with an affiliated firm. Rep & Firm vigorously deny any liability to these claims.

$465,000.00

$250,000.00

Rep & Firm deny any liability to this claim and settled the claim to avoid the cost and distraction of protracted litigation.

Customer was unhappy with the performance of their investment with an affiliated firm. Rep & Firm vigorously deny any liability to these claims and made a business decision to come to a settlement to avoid costs and distractions of litigated proceedings.

$315,000.00

$315,000.00

PeachCap Securities Inc was a party to the settlement due to affiliated firm association. Settlement was paid by affiliated firm and not by PeachCap Securities Inc. Rep was not required to contribute to the settlement amount. Rep & Firm deny any liability to this claim and made a business decision to come to a settlement in order to avoid costs and distraction of litigated proceedings.

Customer was unhappy with the performance of his investment with an affiliated firm. Rep & Firm vigorously deny any liability to these claims and made a business decision to come to a settlement to avoid costs and distractions of litigated proceedings.

$100,000.00

PeachCap Securities Inc was a party to the settlement due to affiliated firm association. Settlement was paid by affiliated firm and not by PeachCap Securities Inc. Rep was not required to contribute to the settlement amount. Rep & Firm deny any liability to this claim and made a business decision to come to a settlement in order to avoid costs and distraction of litigated proceedings.