United States SEC Fines $1 Billion Asia-Focused Investment Firm Mass Ave Global and Founder, CEO & CIO Winston Feng $600,000 for Misleading Statements on Flagship Fund Holdings & Exposures from 2020 to 2022 and Not Disclosing Conflict of Interest of Mass Ave Global Co-Founder Operating a Separate Hedge Fund in China, Winston Feng is Also Suspended for 12 Months, United States SEC Instructed Mass Ave Global to Report to Investors on Inaccuracy in 2023 January Resulting in Redemptions & Has Shut Down Operations
5th June 2024 | Hong Kong
The United States Securities & Exchange Commission (SEC) has fined $1 billion Asia-focused investment firm Mass Ave Global and founder, CEO & CIO Winston Feng $600,000 ($350,000, $250,000) for misleading statements on Mass Ave Global flagship fund holdings & exposures from 2020 to 2022, and not disclosing conflict of interest of Mass Ave Global co-founder operating a separate hedge fund in China. Mass Ave Global and founder, CEO & CIO Winston Feng is also suspended for 12 months. In 2023 January, the United States SEC instructed Mass Ave Global to report to investors on the inaccuracy, resulting in redemptions & has since shut down operations. United States SEC (29/5/24): “The Securities and Exchange Commission today instituted settled proceedings against formerly registered investment adviser Mass Ave Global Inc. (MassAve) and its co-founder and CEO Winston M. Feng for making false and misleading statements to investors in MassAve’s flagship opportunity fund. To settle the SEC’s charges, MassAve agreed to pay a civil penalty of $350,000, and Feng agreed to pay a civil penalty of $250,000. In addition, Feng, who is also the chief investment officer and portfolio manager at MassAve, is suspended for 12 months from industry-related work. According to the SEC’s orders, from 2020 to 2022, New York City-based MassAve, an investment adviser that made Asia-focused investments and that held more than $1 billion in regulatory assets under management, made a series of materially false and misleading statements about its flagship opportunity fund’s holdings and exposures. The orders found that some of the false statements were the result of modifications Feng made to underlying portfolio data, which MassAve then included in investor communications, such as its monthly tear sheets, summary portfolio snapshots, and top 10 position lists. In addition, according to the SEC’s orders, from late 2022 to early 2023, MassAve did not report to its investors a conflict of interest arising from MassAve’s other co-founder operating a separate hedge fund in China. The SEC’s order against MassAve also found failures in the firm’s compliance policies and procedures. According to the SEC’s orders, in January 2023, MassAve reported to investors that its communications about the flagship fund were inaccurate and did not contain appropriate disclosures. Soon thereafter, MassAve received a wave of redemption requests and has since been winding down operations. The SEC’s orders found that MassAve violated the antifraud and compliance provisions of the Investment Advisers Act of 1940 and that Feng violated the antifraud provisions of the Advisers Act. Without admitting or denying the SEC’s findings, MassAve and Feng consented to the entry of the SEC’s orders requiring them to cease and desist from further violations, censuring MassAve, and imposing the penalties listed above. The SEC’s investigation was conducted by Joseph P. Ceglio and Kelly Rock, of the Division of Enforcement’s Complex Financial Instruments Unit, with assistance from Ling Yu and Travis Hill, of the New York Regional Office, and was supervised by Joshua Brodsky, also of the Complex Financial Instruments Unit.”
“ United States SEC Fines $1 Billion Asia-Focused Investment Firm Mass Ave Global and Founder, CEO & CIO Winston Feng $600,000 for Misleading Statements on Flagship Fund Holdings & Exposures from 2020 to 2022 and Not Disclosing Conflict of Interest of Mass Ave Global Co-Founder Operating a Separate Hedge Fund in China, Winston Feng is Also Suspended for 12 Months, United States SEC Instructed Mass Ave Global to Report to Investors on Inaccuracy in 2023 January Resulting in Redemptions & Has Shut Down Operations “
Osman Nawaz, Chief of the SEC Enforcement Division’s Complex Financial Instruments Unit: “Complete and accurate reporting at all turns, whether in investor communications or about conflicts of interest, is vital to investor protection. We will continue to hold individuals accountable for falling short in making such disclosures.”
United States SEC Fines $1 Billion Asia-Focused Investment Firm Mass Ave Global and Founder, CEO & CIO Winston Feng $600,000 for Misleading Statements on Flagship Fund Holdings & Exposures from 2020 to 2022 and Not Disclosing Conflict of Interest of Mass Ave Global Co-Founder Operating a Separate Hedge Fund in China, Winston Feng is Also Suspended for 12 Months, United States SEC Instructed Mass Ave Global to Report to Investors on Inaccuracy in 2023 January Resulting in Redemptions & Has Shut Down Operations
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