SEC v. Donald L. Koch and Koch Asset Management, LLC (marking the close, 2015)

Judgment entered

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In July 2015 the SEC reported that the D.C. Circuit had largely affirmed its May 2014 order finding investment adviser Donald L. Koch and Koch Asset Management liable for marking the close, manipulating the closing prices of stocks held in client portfolios on the last trading day of consecutive quarters. The court upheld the adviser, broker and dealer bars but vacated the municipal-advisor and rating-agency bars.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

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Alleged gain

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A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars.

What is alleged to have happened

The Securities and Exchange Commission announced this appellate result on July 20, 2015 as litigation release LR-23308. The respondents are Donald L. Koch and Koch Asset Management, LLC (1 individual, 1 entity). The case was an SEC administrative proceeding that ended in a Commission order dated May 16, 2014; Koch and his firm then petitioned the U.S. Court of Appeals for the D.C. Circuit.

The Commission found that Koch and the firm violated Section 10(b) and Rule 10b-5 and Sections 206(1) and 206(2) of the Advisers Act by marking the close, that is, manipulating the closing prices of stocks held in client portfolios on the last trading day of consecutive quarters, and that they violated Section 206(4) and Rule 206(4)-7 by failing to adopt reasonable compliance policies. In a decision of July 14, 2015 the court rejected the substantial-evidence and primary-violator arguments and affirmed those findings.

The court upheld the adviser, broker, dealer, municipal securities dealer and transfer agent bars but vacated the municipal advisor and rating agency bars, finding that the Commission applied the 2010 Dodd-Frank Act retroactively. The earlier record showed the matter as still on appeal; the appeal had been decided. This release states no penalty or disgorgement figure.

For the regulator's own account of the facts, read the primary document linked above.

What technique is this, and how does it work?

This action is tagged with one technique in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Marking the close — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2015-07-20 Litigation release published

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEC litigation release

The linked release is a work of the United States government and is not subject to copyright. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added September 10, 2026. submit a correction.