Risk & Compliance

Firm Settles with SEC for Missing Eight Filings

Real Estate Firm W2007 Grace Acquisition, after incorrectly calculating its number of record holders, thought it had too few to file.
Katie Kuehner-HebertApril 23, 2015

The Securities and Exchange Commission Wednesday announced that real estate investment firm W2007 Grace Acquisition I has agreed to pay $640,000 to settle charges relating to eight missed filings. The firm is indirectly owned by one or more private equity funds affiliated with Goldman Sachs.

The SEC contends that W2007 Grace incorrectly calculated that it had fewer than 300 holders of record on Jan. 1, 2014, and as such, erroneously concluded that it did not need to file public reports. However, W2007 Grace had, in fact, improperly treated certain distinct corporations and custodial accounts as single holders of record, the SEC contends, and as a result, the company should have resumed making public filings.

“When companies cease disclosures to the public and go dark, they must ensure that they accurately count their holders of record, so that investors are not deprived of information they are entitled to under the law.” Andrew Ceresney, director of the SEC’s Division of Enforcement, said in a press release announcing the settlement. “W2007 Grace failed to correctly count their holders of record and this action should send the message that there will be consequences for such lapses.”

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In addition to paying the civil monetary penalty, W2007 Grace must file a 10-K for 2014 by May 15, as well as a Form 10-K for 2013 by July 1, the SEC said.