DOB: Anthem Asset Management Stipulation

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IN THE MATTER OF:

ANTHEM ASSET MANAGEMENT, LLC

(CRD number 136271)

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STIPULATION
AND AGREEMENT

No. ST-06-7260-S


WHEREAS the Banking Commissioner (the "Commissioner") is charged with the administration of Chapter 672a of the Connecticut General Statutes, the Connecticut Uniform Securities Act (the "Act") and Sections 36b-31-2 et seq. of the Regulations of Connecticut State Agencies (the "Regulations") promulgated under the Act;

WHEREAS Anthem Asset Management, LLC (“Anthem”) is an applicant for investment adviser registration under the Act and has its principal office located at 1720 Post Road, P.O. Box 5113, Westport, Connecticut;

WHEREAS in connection with its October 4, 2005 application for investment adviser registration, Anthem disclosed that 1) commencing in or about September 2004, it had rendered investment advisory services to Anthem Opportunity Fund, L.P., an entity for which it acted as general partner; and 2) the limited partners of Anthem Opportunity Fund, L.P. consisted of two individuals having a familial relationship to William Joseph DeRosa, Jr., the sole manager of Anthem;

WHEREAS the Commissioner, through the Securities and Business Investments Division of the Department of Banking (the "Division"), conducted a follow-up investigation pursuant to Sections 36b-8 and 36b-26 of the Act to assess the accuracy of the information provided by Anthem;

WHEREAS the Commissioner acknowledges that Anthem cooperated with the Division in providing requested information and documents in conjunction with such investigation;

WHEREAS as a result of such investigation, the Commissioner alleges that from approximately September 2004 forward, Anthem transacted business as an investment adviser to Anthem Opportunity Fund, L.P. while unregistered and employed an unregistered investment adviser agent in contravention of Section 36b-6(c) of the Act;

WHEREAS Section 36b-6(c) of the Act provides, in part, that:  “(1) No person shall transact business in this state as an investment adviser unless registered as such by the commissioner as provided in sections 36b-2 to 36b-33, inclusive, or exempted pursuant to subsection (e) of this section . . . (3) No investment adviser shall engage an investment adviser agent unless such investment adviser agent is registered under ... [the Act]";

WHEREAS Chapter 54 of the Connecticut General Statutes permits the resolution of a contested case by stipulation or agreed settlement;

WHEREAS Anthem desires to settle the matter described herein and, without either admitting or denying the truth of the Commissioner's allegations set forth hereinabove, voluntarily enters into this Stipulation and Agreement, acknowledging that this Stipulation and Agreement is in lieu of any court action or administrative proceeding adjudicating any issue of fact or law on the matters described herein;

WHEREAS Anthem, through its execution of this Stipulation and Agreement, voluntarily waives any rights it may have to seek judicial review or otherwise challenge or contest the terms and conditions of this Stipulation and Agreement;

NOW THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS FOLLOWS:

1. No later than the date this Stipulation and Agreement is executed by the Commissioner, Anthem shall remit to the department by certified bank check payable to "Treasurer, State of Connecticut" the sum of one thousand seven hundred dollars ($1,700), one thousand five hundred dollars ($1,500) of which shall constitute an administrative fine and two hundred ($200) dollars of which shall represent past due investment adviser and investment adviser agent registration fees;
2.
Anthem shall comply with all statutory requirements governing the registration of affected personnel as investment adviser agents, and shall review, revise and implement such supervisory and compliance procedures as are necessary to ensure such compliance;
3. In connection with future offerings of securities of Anthem Opportunity Fund, L.P. or any other fund for which Anthem serves as investment adviser, Anthem shall employ legal counsel familiar with state and federal securities laws to ensure compliance with applicable securities registration, exemptive, notice filing and disclosure requirements;
4. Execution of this Stipulation and Agreement by the Commissioner is without prejudice to the right of the Commissioner to take enforcement action against Anthem based upon a violation of this Stipulation and Agreement or the basis for its entry if the Commissioner determines that compliance is not being observed with the terms hereof; and
5. This Stipulation and Agreement shall become binding when executed by Anthem and the Commissioner.


IN WITNESS WHEREOF, the undersigned have executed this Stipulation and Agreement on the dates indicated.

 

               ________/s/_________
 John P. Burke
            Banking Commissioner

Dated at Hartford, Connecticut                 
this 12th day of May 2006.                         
 

I, William Joseph DeRosa, Jr., state on behalf of Anthem Asset Management, LLC, that I have read the foregoing Stipulation and Agreement; that I know and fully understand its contents; that I am authorized to execute this Stipulation and Agreement on behalf of Anthem Asset Management, LLC and that Anthem Asset Management, LLC agrees freely and without threat or coercion of any kind to comply with the terms and conditions stated herein.
                                                                   

      Anthem Asset Management, LLC

By
       ________/s/_______________
      William Joseph DeRosa, Jr.
      Managing Member


On this 10 day of May 2006, personally appeared William Joseph DeRosa, Jr., signer of the foregoing Stipulation and Agreement, who, being duly sworn, did acknowledge to me that he was authorized to execute the same on behalf of Anthem Asset Management, LLC, a limited liability company, and acknowledged the same to be his free act and deed, before me.


_______________/s/_______________________
Notary Public/Commissioner of the Superior Court
My Commission Expires:  Mar. 31, 2010



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