Galois Capital Charged by SEC for Custody Rule Violations
SEC Charges Galois Capital Over Custody Violations
The U.S. Securities and Exchange Commission (SEC) has charged and settled with crypto-focused investment advisory firm Galois Capital concerning custody issues. According to the SEC, Galois’s private fund, primarily invested in crypto assets, failed to comply with Custody Rule provisions. This negligence raised substantial concerns about the safety of investors’ assets.
Risk Exposure to Investors
Corey Schuster, co-chief of the SEC Enforcement Division’s Asset Management Unit, stated, “By failing to comply with Custody Rule provisions, Galois Capital exposed investors to risks that fund assets, including crypto assets, could be lost, misused, or misappropriated.” The SEC emphasizes the importance of holding advisors accountable for upholding their core investor protection obligations.
Ongoing Developments
This case serves as a warning to the industry about compliance with regulatory standards. As the situation unfolds, the SEC remains vigilant in protecting investors in the burgeoning crypto market.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.