The Securities and Exchange Commission has charged fintech investment adviser Titan Global Capital Management USA with misleading investors with advertisements about performance metrics.
In brief:
-In the first case involving the SEC's amended marketing rule, Tian has agreed to pay over $1 million to settle the charges, without admitting or denying the findings
-The order also found that Titan made conflicting disclosures to clients about how it custodied crypto assets
-The regulator says the adverts were misleading because they failed to include material information, for example, that the hypothetical performance projections assumed that the strategy’s performance in its first three weeks would continue for an entire year
What does this mean?
Osman Nawaz, chief of enforcement’s complex financial instruments unit, SEC, says: "The Commission amended the marketing rule to allow for the use of hypothetical performance metrics but only if advisers comply with requirements reasonably designed to prevent fraud.
