SEC v. Fifth Street Management, LLC (2018)

Settled

Checked against the primary document on October 3, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, with sampled and disputed records read a second time. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.

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In December 2018 the SEC settled proceedings against Fifth Street Management over improperly allocated expenses and failed valuation reviews at its business development company clients. It was censured and ordered to pay $1,999,116 disgorgement, $334,546 interest and a $1.65 million penalty. The order does not charge insider trading.

The record

Structured fields for this action, as recorded in our case library.
Agency	SEC
Release number	3-18909
Date filed	2018-12-03
Date resolved	2018-12-03
Status	settled
Asset class	equities
Criminal parallel	No
Defendants	Fifth Street Management, LLC (entity)
Cited as charged or alleged	Advisers Act s.204A ; Advisers Act s.206 ; Exchange Act s.13(a) ; Securities Act s.17(a) (statutes and rules cited in the document; not a finding that they were violated)
Techniques

What was ordered

Civil penalty: $1.7m
Disgorgement: $2m
Prejudgment interest: $335k
Total relief: $4m
Alleged gain: —

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 Commission found that in 2013 and 2014 the adviser charged its business development companies $1,208,510 of rent and overhead and $118,895 of employee compensation that it should have borne, and that its quality-control review of valuation models failed, leading one fund to overvalue two portfolio companies and misstate its financial statements while it sold additional shares. The record had carried an insider-trading tag that nothing in the order supports, so it has been removed.

Timeline

2018-12-03 Administrative proceeding instituted (cease-and-desist)

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 order

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.

Record added September 10, 2026. submit a correction.