SEC v. Steven R. Markusen and Jay C. Cope (marking the close, 2016)

Judgment entered

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In November 2016 an SEC administrative law judge barred Archer Advisors founder Steven R. Markusen and colleague Jay C. Cope from the securities industry by default, following district court judgments that found they billed their funds for sham research fees, marked the close of a thinly traded stock to inflate reported returns, and day-traded the funds' accounts to generate soft dollars. The judgments carried $100,000 penalties each and about $1.18 million in disgorgement.

The record

What was ordered

Civil penalty

$200k

Disgorgement

$1.2m

Prejudgment interest

—

Total relief

$1.4m

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

An SEC administrative law judge issued Initial Decision No. 1079 on November 9, 2016 in administrative proceeding 3-17265, granting the Division of Enforcement's motion for sanctions after neither respondent answered the order instituting proceedings. The respondents are Steven R. Markusen and Jay C. Cope (2 individuals, 0 entities). Earlier versions of this record listed three respondents with mangled names.

The proceeding follows SEC v. Markusen, No. 14-cv-3395 (D. Minn.). The facts come from that court's findings, recited in the order: from 2008 to 2013 Markusen, who ran Archer Advisors and its two private funds, and Cope billed the funds for research expenses by presenting Cope as an independent consultant; they marked the close of CyberOptics, a thinly traded stock, by placing buy orders in the last half hour of the final trading day of at least 28 months, which inflated reported returns and fees; and Cope day-traded the funds' accounts, described by the court as churning, to generate soft dollars to cover the sham invoices.

The decision's sanction is a full collateral bar for each man. The monetary figures belong to the district court judgments it recites: disgorgement of $630,830 (Markusen, jointly with Archer) and $549,285 (Cope), and a $100,000 penalty on each, plus prejudgment interest. The record stores the two penalties and the combined disgorgement; Cope's interest was $81,037 and Markusen's is not stated. The earlier $147,000 figure was commissions generated by the trading, not a gain.

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

What technique is this, and how does it work?

This action is tagged with 2 techniques 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.
• Churning — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2016-11-09 Initial decision

Primary documents

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

• Initial decision (ID-1079)
• Order instituting proceedings
• Finality 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.

Related actions

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

Record added September 10, 2026. submit a correction.