The allegations read: The securities and exchange commission ("commission") deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted against peter j. Decaprio ("decaprio" or "respondent"). In anticipation of the institution of these proceedings, respondent has submitted an offer of settlement which the commission has determined to accept. The commissions finds that it's complaint alleged that during the period from about july 2020 through late 2023, flowpoint and decaprio misrepresented to investors that the funds were audited annually by an independent auditor. While flowpoint and decaprio engaged an auditor to audit two of the four funds, that auditor did not produce any audit reports, and none of the funds were audited. Flowpoint and decaprio did not correct their ongoing misstatements to investors despite knowing that the funds were not actually audited by the auditor they had engaged. Flowpoint and decaprio breached their fiduciary duty to two of the funds they advised by failing to obtain annual audits for those two funds, as those funds' organizational documents (a limited partnership agreement and limited liability company agreement) required. Flowpoint and decaprio were investment advisers to the funds. By failing to operate those funds as they were required to be operated, they failed in their duty as investment advisers to those funds and operated a fraud on the funds and their investors. They also defrauded investors in the funds by making material misstatements about audits of the funds and the identify of their auditor to investors. The commission's complaint also alleged that between july 2020 until september 2023 flowpoint failed to maintain or enforce written policies and procedures regarding the misuse of material nonpublic information and that decaprio aided and abetted this violation.
