SEC Flags Missing Audits in Probe of Investment Advisers

Five investment advisory firms failed to provide audited financial statements that met US audit standards to their investors in violation of federal custody rules, the SEC said Tuesday.

The firms agreed to pay penalties between $50,000 and $225,000 apiece to settle charges, which also included disclosure and custodian violations, the Securities and Exchange Commission said. They had regulatory assets under management up to $1 billion.

• The Wall Street regulator uncovered the missing or deficient private fund audits as part of its second sweep to monitor compliance with the Investment Advisers Act and its requirements to safeguard customer assets. Those rules ...