Summary Notice of Distribution of the Taberna Fair Fund Established by the Securities & Exchange Commission ("SEC")

MINNEAPOLIS, July 15, 2019 /PRNewswire/ -- The following is being released by Rust Consulting, Inc. about the Taberna Fair Fund Established by the Securities & Exchange Commission related to the case In the Matter of Taberna Capital Management, LLC, Michael Fralin, and Raphael Licht, Adm. Proc. File No. 3-16776.

If you purchased or held certain Taberna Capital Management, LLC collateral debt obligations ("Taberna CDOs") available on the Taberna Fair Fund website (www.TabernaFairFund.com), you may be eligible for recovery from the Taberna Fair Fund. 

PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY.
THIS NOTICE CONTAINS IMPORTANT INFORMATION REGARDING THE TABERNA FAIR FUND, THE HARMED SECURITIES, THE CLAIMS PROCESS, AND THE DEADLINE FOR FILING A CLAIM.

What this case is about:

On September 2, 2015, the Securities and Exchange Commission (the "Commission") issued an Order Instituting Administrative and Cease-and-Desist Proceedings Pursuant to Sections 4C, 15(b), and 21C of the Securities Exchange Act of 1934, Sections 203(e), 203(f ) and 203(k) of the Investment Advisers Act of 1940, Section 9(b) of the Investment Company Act of 1940, and Rule 102(e) of the Commission's Rules of Practice, Making Findings, and Imposing Remedial Sanctions and Cease-and-Desist Orders (the "Order") against Taberna Capital Management, LLC ("Taberna"), Michael Fralin ("Fralin"), and Raphael Licht ("Licht") (collectively, the "Respondents").

The Commission determined that, between 2009 and 2012, in connection with restructuring transactions undertaken between the Taberna CDOs and the issuers of the underlying obligations in the Taberna CDOs' portfolios, Taberna retained Exchange Fees that should have been paid to the Taberna CDOs. The Commission further determined that the retention of Exchange Fees created actual and potential conflicts of interest that Taberna failed to disclose to its clients. The Commission found that Fralin and Licht, former officers of Taberna and its parent company, respectively, participated in the misconduct. The Commission ordered Taberna to disgorge $13 million and pay prejudgment interest of $2 million and a civil penalty of $6.5 million, and Fralin and Licht to pay civil penalties of $100,000.00 and $75,000.00, respectively. The Commission established a disgorgement fund for the distribution of the $15 million in disgorgement and prejudgment interest paid by Taberna to injured investors to compensate them for the harm they suffered because of the Respondents' violations.

On August 24, 2017, the Commission established a Fair Fund pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002 so that ordered civil penalties, including the $6.6 million thus far collected from the Respondents and any future collections, could be added to the $15 million in disgorgement and prejudgment interest, for the benefit of the injured investors. To date, the Respondents have paid approximately $21.6 million in disgorgement, prejudgment interest, and civil penalties into the Taberna Fair Fund.

On July 27, 2017, the Commission appointed Miller Kaplan Arase LLP as Tax Administrator for the Taberna Fair Fund to handle its tax obligations.

On November 20, 2017, the Commission appointed the Fund Administrator to assist in developing and executing the Plan.

On May 2, 2019, the Commission approved a Plan of Distribution for the Taberna Fair Fund (the "Plan").

Who is Potentially Eligible for Compensation

To qualify for a payment from the Taberna Fair Fund, you must have purchased or held a Harmed Security during the Recovery Period, and satisfy other criteria as set forth in the Plan. If you received a Plan Notice, refer to Exhibit A to the Plan Notice for a listing of the Harmed Securities and paragraph 11.s of the Plan for the Recovery Period for each.  If you did not receive a Plan Notice, you can access both documents at the Taberna Fair Fund website (www.TabernaFairFund.com), or you can request copies as set forth below.  

How to File a Claim

You can obtain a claim form at www.TabernaFairFund.com or request a Claim Form as set forth below. 

You can file a Claim Form by mailing the completed form to:

Taberna Fair Fund
c/o Rust Consulting, Inc.
Fund Administrator - 5917
P.O. Box 44
Minneapolis, MN 55440-0044

You must complete and sign the Claim Form and submit it to Fund Administrator so that it is postmarked (or if not sent by U.S. Mail, received) no later than September 12, 2019.

How to Obtain Relevant Documents or Additional Information

Copies of the Plan, the Plan Notice, the list of Harmed Securities, and the Claim Form are available at www.TabernaFairFund.com.  You may also obtain a copy by calling 1 (866) 898-5092 or by emailing the Fund Administrator at [email protected].  Information on the Taberna Fair Fund is also available on the Commission's public website at https://www.sec.gov/divisions/enforce/claims/taberna.htm.

SOURCE Rust Consulting, Inc.

Related Links

http://www.tabernafairfund.com