UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934

Release No. 99498 / February 9, 2024

INVESTMENT ADVISERS ACT OF 1940

Release No. 6547 / February 9, 2024

ADMINISTRATIVE PROCEEDING

File No. 3-21847

In the Matter of

Cambridge Investment 

Research, Inc. and Cambridge 

Investment Research Advisors, 

Inc.,

Respondents.

ORDER INSTITUTING ADMINISTRATIVE 

AND CEASE-AND-DESIST PROCEEDINGS, 

PURSUANT TO SECTIONS 15(b) AND 21C 

OF THE SECURITIES EXCHANGE ACT OF 

1934 AND SECTIONS 203(e) AND 203(k) OF 

THE INVESTMENT ADVISERS ACT OF 

1940, MAKING FINDINGS, AND IMPOSING 

REMEDIAL SANCTIONS AND A CEASEAND-DESIST ORDER

I.

The Securities and Exchange Commission (“Commission”) deems it appropriate and in 

the public interest that public administrative and cease-and-desist proceedings be, and hereby 

are, instituted pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 

(“Exchange Act”) against Cambridge Investment Research, Inc. (“CIR”) and Sections 203(e) and 

203(k) of the Investment Advisers Act of 1940 (“Advisers Act”) against Cambridge Investment 

Research Advisors, Inc. (“CIRA”) (collectively, “Respondents” or “Cambridge”).

II.

In anticipation of the institution of these proceedings, Respondents have submitted Offers

of Settlement (“Offers”) that the Commission has determined to accept. Respondents admit the 

facts set forth in Section III below, acknowledge that their conduct violated the federal securities 

laws, admit the Commission’s jurisdiction over them and the subject matter of these proceedings, 

and consent to the entry of this Order Instituting Administrative and Cease-and-Desist 

Proceedings, Pursuant to Sections 15(b) and 21C of the Securities Exchange Act of 1934 and 

Sections 203(e) and 203(k) of the Investment Advisers Act of 1940, Making Findings, and 

Imposing Remedial Sanctions and a Cease-and-Desist Order (“Order”), as set forth below. 
2 

III.

 On the basis of this Order and Respondents’ Offers, the Commission finds1 that

Summary

1. The federal securities laws impose recordkeeping requirements on broker-dealers 

and registered investment advisers to ensure that they responsibly discharge their crucial role in 

our markets. The Commission has long said that compliance with these requirements is essential 

to investor protection and the Commission’s efforts to further its mandate of protecting investors, 

maintaining fair, orderly, and efficient markets, and facilitating capital formation.

2. These proceedings arise out of the widespread and longstanding failure of 

Cambridge employees throughout the firms, including at senior levels, to adhere to certain of 

these essential requirements and the firms’ own policies. Using their personal devices, these 

employees communicated both internally and externally by personal text messages (“off-channel 

communications”). 

3. From at least January 2019, CIR employees sent and received off-channel 

communications that related to the business of the broker-dealer, and CIRA employees sent and 

received off-channel communications that related to recommendations made or proposed to be 

made and advice given or proposed to be given. Respondents did not maintain or preserve the 

substantial majority of these written communications. Respondents’ failures were firm-wide, 

and involved employees at various levels of authority. As a result, CIR violated Section 17(a) of 

the Exchange Act and Rule 17a-4(b)(4) thereunder and CIRA violated Section 204 of the 

Advisers Act and Rule 204-2(a)(7) thereunder. 

4. Cambridge’s supervisors, who were responsible for supervising junior employees, 

routinely communicated off-channel using their personal devices. In fact, senior managers and 

department heads responsible for supervising junior employees themselves failed to comply with 

Cambridge’s policies by communicating using non-Cambridge approved methods on their 

personal devices about Cambridge’s broker-dealer and/or investment adviser businesses, as 

applicable. 

5. Cambridge’s widespread failure to implement their policies and procedures that 

prohibit such communications led to their failure to reasonably supervise their employees within 

the meaning of Section 15(b)(4)(E) of the Exchange Act as to CIR and Section 203(e)(6) of the 

Advisers Act as to CIRA. 

6. During the time period that Cambridge failed to maintain and preserve 

off-channel communications that their employees sent and received related to the broker-dealer

and investment adviser businesses, Cambridge received and responded to Commission 

subpoenas for documents and/or records requests in numerous Commission investigations. As a 

result, Cambridge’s recordkeeping failures likely impacted the Commission’s ability to carry out 

1

 The findings herein are made pursuant to Respondents’ Offers of Settlement and are not 

binding on any other person or entity in this or any other proceeding. 
3 

its regulatory functions and investigate violations of the federal securities laws across these 

investigations. 

7. Commission staff uncovered Cambridge’s misconduct after commencing a 

risk-based initiative to investigate the use of off-channel and unpreserved communications at 

broker-dealers. Cambridge has initiated a review of their recordkeeping failures and begun a 

program of remediation. As set forth in the Undertakings below, Cambridge will retain an 

independent compliance consultant to review and assess Cambridge’s remedial steps relating to 

Cambridge’s recordkeeping practices, policies and procedures, related supervisory practices, and 

employment actions. 

Respondents 

8. Cambridge Investment Research, Inc. is an Iowa corporation with its principal 

office in Fairfield, Iowa and is registered with the Commission as a broker-dealer. It is a 

subsidiary of Cambridge Investment Group, Inc., a holding company headquartered in Fairfield, 

Iowa and incorporated in Iowa.

9. Cambridge Investment Research Advisors, Inc. is an Iowa corporation with its 

principal office in Fairfield, Iowa and is registered with the Commission as an investment adviser. 

It is a subsidiary of Cambridge Investment Group, Inc., a holding company headquartered in 

Fairfield, Iowa and incorporated in Iowa.

Recordkeeping Requirements under the Exchange and Advisers Acts

10. Section 17(a)(1) of the Exchange Act and Section 204 of the Advisers Act 

authorize the Commission to issue rules requiring, respectively, broker-dealers and investment 

advisers to make and keep for prescribed periods, and furnish copies of, such records as 

necessary or appropriate in the public interest, for the protection of investors or otherwise in 

furtherance of the purposes of the Exchange Act and the Advisers Act. 

11. The Commission adopted Rule 17a-4 under the Exchange Act and Rule 204-2 

under the Advisers Act pursuant to this authority. These rules specify the manner and length of 

time that the records created in accordance with Commission rules, and certain other records 

produced by broker-dealers or investment advisers, must be maintained and produced promptly 

to Commission representatives. 

12. The rules adopted under Section 17(a)(1) of the Exchange Act, including Rule 

17a-4(b)(4), require that broker-dealers preserve in an easily accessible place originals of all 

communications received and copies of all communications sent relating to the firm’s business 

as such. These rules impose minimum recordkeeping requirements that are based on standards a 

prudent broker-dealer should follow in the normal course of business. 

13. The rules adopted under Advisers Act Section 204, including Advisers Act Rule 

204-2(a)(7), require that investment advisers preserve in an easily accessible place originals of all 

communications received and copies of all written communications sent relating to, among other 
4 

things, any recommendation made or proposed to be made and any advice given or proposed to be 

given.

14. The Commission previously has stated that these and other recordkeeping 

requirements “are an integral part of the investor protection function of the Commission, and 

other securities regulators, in that the preserved records are the primary means of monitoring 

compliance with applicable securities laws, including antifraud provisions and financial 

responsibility standards.” Commission Guidance to Broker-Dealers on the Use of Electronic 

Storage Media under the Electronic Signatures in Global and National Commerce Act of 2000 

with Respect to Rule 17a-4(f), 17 C.F.R. Part 241, Exchange Act Rel. No. 44238 (May 1, 2001). 

Cambridge’s Policies and Procedures

15. Cambridge maintained certain policies and procedures designed to ensure the 

retention of business-related records, including electronic communications, in compliance with 

the relevant recordkeeping provisions. 

16. Cambridge employees were advised that the use of unapproved electronic 

communications methods, including on their personal devices, was not permitted, and they 

should not use personal email, chats or text messaging applications for business purposes, or 

forward work-related communications to their personal devices. 

17. Messages sent through Cambridge-approved communications methods were 

monitored, subject to review, and, when appropriate, archived. Absent steps taken by individual 

personnel to preserve work-related communications, messages sent through unapproved 

communications methods, such as unapproved applications on personal devices, were not 

monitored, subject to review or archived. 

18. Cambridge policies were designed to address supervisors’ supervision of 

employees’ training in Cambridge’s communications policies and adherence to Cambridge’s 

books and recordkeeping requirements. Supervisory policies notified employees that electronic 

communications were subject to surveillance by Cambridge. Cambridge had procedures for all 

employees, including supervisors, requiring annual self-attestations of compliance. 

19. Cambridge, however, failed to implement a system of follow-up and review to 

determine that supervisors were reasonably following Cambridge’s policies. While permitting 

employees to use approved communications methods, including on personal phones, for business 

communications, Cambridge failed to implement sufficient monitoring to assure that their

recordkeeping and communications policies were being followed. 

Cambridge’s Recordkeeping Failures Across Their Businesses

20. In September 2021, the Commission staff commenced a risk-based initiative to 

investigate whether broker-dealers were properly retaining business-related messages sent and 

received on personal devices. Cambridge cooperated with the investigation by voluntarily 

interviewing a sampling of senior personnel and gathering and reviewing messages found on the 
5 

individuals’ personal devices. These personnel included senior leadership, such as department 

heads and vice presidents. 

21. The Commission staff’s investigation uncovered pervasive off-channel 

communications at various seniority levels of CIR. In addition, the Commission staff’s 

investigation uncovered the use of off-channel communications within CIRA. The investigation 

determined that most broker-dealer and investment adviser personnel sampled had engaged in at 

least some level of off-channel communications. Overall, these personnel sent and received 

numerous off-channel communications, involving other Cambridge personnel and external 

contacts in the securities industry. Within Cambridge, a number of senior leadership participated 

in off-channel communications. 

22. From at least January 2019, CIR personnel sent and received off-channel

messages that concerned the broker-dealer’s business. 

23. For example, from January 10, 2022 to June 29, 2022, a CIR vice president who 

was also an employee of CIRA exchanged numerous off-channel messages with at least six CIR 

and CIRA colleagues, including with junior employees under their supervision. These messages 

related to the broker-dealer’s business as such.

24. In addition, from January 14, 2022 to June 29, 2022, a CIR division head who 

was also an employee of CIRA exchanged numerous off-channel messages with at least four CIR 

and CIRA colleagues. These messages related to the broker-dealer’s business as such. 

25. As another example, from January 25, 2022 to March 30, 2022, a CIR vice 

president exchanged numerous off-channel messages with at least three CIR colleagues and at 

least one external contact in the securities industry. These messages related to the 

broker-dealer’s business as such.

26. From at least January 2019, CIRA personnel sent and received off-channel 

messages related to, among other things, providing and recommending investment advice to 

clients. 

27. For example, in June 2022, a CIRA vice president exchanged off-channel messages 

with a CIRA colleague related to, among other things, investment advice provided to clients. 

Cambridge’s Failure to Preserve Required Records Potentially

Compromised and Delayed Commission Matters

28. Between January 2019 and the present, Cambridge received and responded to 

Commission subpoenas for documents and/or records requests in Commission investigations. 

By failing to maintain and preserve required records relating to their businesses, Cambridge 

likely deprived the Commission of these off-channel communications in various investigations. 
6 

Cambridge’s Violations and Failure to Supervise

29. As a result of the conduct described above, from at least January 2019 through the 

date of this Order, CIR willfully2 violated Section 17(a) of the Exchange Act and Rule 

17a-4(b)(4) thereunder, which require broker-dealers to preserve for at least three years originals 

of all communications received and copies of all communications sent relating to its business as 

such. 

30. As a result of the conduct described above, from at least January 2019 through the 

date of this Order, CIRA willfully violated Section 204 of the Advisers Act and Rule 204-2(a)(7)

thereunder, which require investment advisersto preserve in an easily accessible place originals of 

all written communicationsreceived and copies of all written communicationssent relating to,

among other things, any recommendation made or proposed to be made and any advice given or 

proposed to be given.

31. As a result of the conduct described above, CIR failed reasonably to supervise its

employees with a view to preventing or detecting certain of its employees’ aiding and abetting 

violations of Section 17(a) of the Exchange Act and Rule 17a-4(b)(4) thereunder, within the 

meaning of Section 15(b)(4)(E) of the Exchange Act. 

32. As a result of the conduct described above, CIRA failed reasonably to supervise its 

employees with a view to preventing or detecting certain of its employees’ aiding and abetting 

violations of Section 204 of the Advisers Act and Rule 204-2(a)(7) thereunder, within the 

meaning of Section 203(e)(6) of the Advisers Act. 

Cambridge’s Remedial Efforts

33. In determining to accept the Offers, the Commission considered steps promptly 

undertaken by Cambridge prior to and after being approached by Commission staff, including 

rolling out an on-channel texting application to Cambridge employees in October 2019, and 

cooperation afforded the Commission staff. 

Undertakings

34. Prior to this action, Cambridge enhanced their policies and procedures, and 

increased training concerning the use of approved communications methods, including on 

2

 “Willfully,” for purposes of imposing relief under Section 15(b) of the Exchange Act and 

Section 203(e) of the Advisers Act “‘means no more than that the person charged with the duty 

knows what he is doing.’” See Wonsover v. SEC, 205 F.3d 408, 414 (D.C. Cir 2000) (quoting 

Hughes v. SEC, 174 F.2d 969, 977 (D.C. Cir. 1949)). There is no requirement that the actor 

“also be aware that he is violating one of the Rules or Acts.” Tager v. SEC, 344 F.2d 5, 8 (2d 

Cir. 1965). The decision in The Robare Group, Ltd. v. SEC, which construed the term 

“willfully” for purposes of a differently structured statutory provision, does not alter that 

standard. 922 F.3d 468, 478-79 (D.C. Cir. 2019) (setting forth the showing required to establish 

that a person has “willfully omit[ted]” material information from a required disclosure in 

violation of Section 207 of the Advisers Act). 
7 

personal devices, and began implementing significant changes to the technology available to 

employees. In addition, Respondents have undertaken to: 

35. Independent Compliance Consultant.

a. CIR and CIRA shall each retain, within thirty (30) days of the entry of this 

Order, the services of an independent compliance consultant (“Compliance Consultant”) 

that is not unacceptable to the Commission staff. The Compliance Consultant’s 

compensation and expenses shall be borne exclusively by Cambridge. 

b. Cambridge will oversee the work of the Compliance Consultant. 

c. Cambridge shall provide to the Commission staff, within sixty (60) days of the 

entry of this Order, a copy of the engagement letter detailing the Compliance 

Consultant’s responsibilities, which shall include a comprehensive compliance review as 

described below. Cambridge shall require that, within ninety (90) days of the date of the 

engagement letter, the Compliance Consultant conduct: 

i. A comprehensive review of Cambridge’s supervisory, compliance, and 

other policies and procedures designed to ensure that Cambridge’s electronic 

communications, including those found on personal electronic devices, including 

without limitation, cellular phones (“Personal Devices”), are preserved in 

accordance with the requirements of the federal securities laws.

ii. A comprehensive review of training conducted by Cambridge to ensure 

personnel are complying with the requirements regarding the preservation of 

electronic communications, including those found on Personal Devices, in 

accordance with the requirements of the federal securities laws, including by 

ensuring that Cambridge personnel certify in writing on a quarterly basis that they 

are complying with preservation requirements. 

iii. An assessment of the surveillance program measures implemented by 

Cambridge to ensure compliance, on an ongoing basis, with the requirements 

found in the federal securities laws to preserve electronic communications, 

including those found on Personal Devices. 

iv. An assessment of the technological solutions that Cambridge has 

begun implementing to meet the record retention requirements of the federal 

securities laws, including an assessment of the likelihood that Cambridge

personnel will use the technological solutions going forward and a review of the 

measures employed by Cambridge to track employee usage of new technological 

solutions. 

v. An assessment of the measures used by Cambridge to prevent the use 

of unauthorized communications methods for business communications by 

employees. This assessment should include, but not be limited to, a review of 
8

Cambridge’s policies and procedures to ascertain if they provide for any 

significant technology and/or behavioral restrictions that help prevent the risk of 

the use of unapproved communications methods on Personal Devices (e.g., 

trading floor restrictions). 

vi. A review of Cambridge’s electronic communications surveillance 

routines to ensure that electronic communications through approved 

communications methods found on Personal Devices are incorporated into 

Cambridge’s overall communications surveillance program. 

vii. A comprehensive review of the framework adopted by Cambridge to 

address instances of non-compliance by Cambridge employees with Cambridge’s 

policies and procedures concerning the use of Personal Devices to communicate 

about Cambridge business in the past. This review shall include a survey of how 

Cambridge determined which employees failed to comply with Cambridge

policies and procedures, the corrective action carried out, an evaluation of who 

violated policies and why, what penalties were imposed, and whether penalties 

were handed out consistently across business lines and seniority levels. 

d. Cambridge shall require that, within forty-five (45) days after completion of 

the review set forth in sub-paragraphs c.i. through c.vii. above, the Compliance 

Consultant shall submit a detailed written report of its findings to each of CIR and CIRA 

and to the Commission staff (the “Report”). Cambridge shall require that the Report 

include a description of the review performed, the names of the individuals who 

performed the review, the conclusions reached, the Compliance Consultant’s 

recommendations for changes in or improvements to Cambridge’s policies and 

procedures, and a summary of the plan for implementing the recommended changes in or 

improvements to Cambridge’s policies and procedures.

e. Cambridge shall adopt all recommendations contained in the Report within 

ninety (90) days of the date of the Report; provided, however, that within forty-five (45) 

days after the date of the Report, Cambridge shall advise the Compliance Consultant and 

the Commission staff in writing of any recommendations that Cambridge considers to be 

unduly burdensome, impractical, or inappropriate. With respect to any recommendation 

that Cambridge considers unduly burdensome, impractical, or inappropriate, Cambridge

need not adopt such recommendation at that time, but shall propose in writing an 

alternative policy, procedure, or disclosure designed to achieve the same objective or 

purpose.

f. As to any recommendation concerning Cambridge’s policies or procedures on 

which Cambridge and the Compliance Consultant do not agree, Cambridge and the 

Compliance Consultant shall attempt in good faith to reach an agreement within sixty 

(60) days after the date of the Report. Within fifteen (15) days after the conclusion of the 

discussion and evaluation by Cambridge and the Compliance Consultant, Cambridge

shall require that the Compliance Consultant inform Cambridge and the Commission 

staff in writing of the Compliance Consultant’s final determination concerning any 
9 

recommendation that Cambridge considers to be unduly burdensome, impractical, or 

inappropriate. Cambridge shall abide by the determinations of the Compliance 

Consultant and, within sixty (60) days after final agreement between Cambridge and the 

Compliance Consultant or final determination by the Compliance Consultant, whichever 

occurs first, Cambridge shall adopt and implement all of the recommendations that the 

Compliance Consultant deems appropriate. 

g. Cambridge shall cooperate fully with the Compliance Consultant and shall 

provide the Compliance Consultant with access to such of Cambridge’s files, books, 

records, and personnel as are reasonably requested by the Compliance Consultant for 

review.

h. Cambridge shall not have the authority to terminate the Compliance Consultant 

or substitute another compliance consultant for the initial Compliance Consultant, 

without the prior written approval of the Commission staff. Cambridge shall compensate 

the Compliance Consultant and persons engaged to assist the Compliance Consultant for 

services rendered under this Order at their reasonable and customary rates.

i. For the period of engagement and for a period of two years from completion of 

the engagement, Cambridge shall not (i) retain the Compliance Consultant for any other 

professional services outside of the services described in this Order; (ii) enter into any 

other professional relationship with the Compliance Consultant, including any 

employment, consultant, attorney-client, auditing or other professional relationship; or 

(iii) enter, without prior written consent of the Commission staff, into any such 

professional relationship with any of the Compliance Consultant’s present or former 

affiliates, employers, directors, officers, employees, or agents acting in their capacity as 

such.

j. The Report by the Compliance Consultant will likely include confidential 

financial, proprietary, competitive business or commercial information. Public disclosure 

of the Report could discourage cooperation, impede pending or potential government 

investigations or undermine the objectives of the reporting requirement. For these 

reasons, among others, the Report and the contents thereof are intended to remain and 

shall remain non-public, except (1) pursuant to court order, (2) as agreed to by the parties 

in writing, (3) to the extent that the Commission determines in its sole discretion that 

disclosure would be in furtherance of the Commission’s discharge of its duties and 

responsibilities, or (4) as otherwise required by law. 

36. One-Year Evaluation. CIR and CIRA shall each require the Compliance 

Consultant to assess Cambridge’s program for the preservation, as required under the federal 

securities laws, of electronic communications, including those found on Personal Devices, 

commencing one year after submitting the Report required by Paragraph 35.d above. Cambridge 

shall require this review to evaluate Cambridge’s progress in the areas described in Paragraph 

35.c.i-vii above. After this review, Cambridge shall require the Compliance Consultant to 

submit a report (the “One Year Report”) to each of CIR and CIRA and the Commission staff and 

shall ensure that the One Year Report includes an updated assessment of Cambridge’s policies 
10 

and procedures with regard to the preservation of electronic communications (including those 

found on Personal Devices), training, surveillance programs, and technological solutions 

implemented in the prior year period. 

37. Reporting Discipline Imposed. For two years following the entry of this Order, 

Cambridge shall notify the Commission staff as follows upon the imposition of any discipline 

imposed by Cambridge, including, but not limited to, written warnings, loss of any pay, bonus, or 

incentive compensation, or the termination of employment, with respect to any employee found to 

have violated Cambridge’s policies and procedures concerning the preservation of electronic 

communications, including those found on Personal Devices: at least 48 hours before the filing of 

a Form U-5, or within ten (10) days of the imposition of other discipline. 

38. Internal Audit. In addition to the Compliance Consultant’s review and issuance of 

the One Year Report, CIR and CIRA will each also have their respective Internal Audit function 

conduct a separate audit(s) to assess Cambridge’s progress in the areas described in Paragraph 

35.c.i-vii above. After completion of this audit(s), Cambridge shall ensure that Internal Audit 

submits a report to CIR and CIRA and to the Commission staff.

39. Recordkeeping. CIR shall preserve, for a period of not less than six (6) years 

from the end of the fiscal year last used, the first two (2) years in an easily accessible place, any 

record of compliance with these undertakings. CIRA shall preserve any record of compliance 

with these undertakings in an easily accessible place for a period of not less than five (5) years 

from the end of the fiscal year during which the entry was made on such record, the first two (2) 

years in an appropriate office of CIRA.

40. Deadlines. For good cause shown, the Commission staff may extend any of the 

procedural dates relating to the undertakings. Deadlines for procedural dates shall be counted in 

calendar days, except that if the last day falls on a weekend or federal holiday, the next business 

day shall be considered to be the last day. 

41. Certification. CIR and CIRA shall each certify, in writing, compliance with the 

undertakings set forth above. The certification shall identify the undertakings, provide written 

evidence of compliance in the form of a narrative, and be supported by exhibits sufficient to 

demonstrate compliance. The Commission staff may make reasonable requests for further 

evidence of compliance, and Respondents agree to provide such evidence. The certification and 

supporting material shall be submitted to Anne C. McKinley, Assistant Regional Director, 

Division of Enforcement, Chicago Regional Office, 175 West Jackson Boulevard, Suite 1450, 

Chicago, Illinois 60604, or such other person as the Commission staff may request, with a copy 

to the Office of Chief Counsel of the Enforcement Division, no later than sixty (60) days from the 

date of the completion of the undertakings. 

IV.

In view of the foregoing, the Commission deems it appropriate and in the public interest 

to impose the sanctions agreed to in Respondents’ Offers. 
11

Accordingly, pursuant to Sections 15(b) and 21C of the Exchange Act as to CIR and 

Sections 203(e) and 203(k) of the Advisers Act as to CIRA, it is hereby ORDERED that:

A. CIR cease and desist from committing or causing any violations and any future 

violations of Section 17(a) of the Exchange Act and Rule 17a-4 thereunder.

B. CIRA cease and desist from committing or causing any violations and any future 

violations of Section 204 of the Advisers Act and Rule 204-2 thereunder.

C. Respondents are censured. 

D. Respondents shall comply with the undertakings enumerated in paragraphs 34 to 

41 above.

E. Respondents shall, jointly and severally, within 14 days of the entry of this Order, 

pay a civil money penalty in the amount of $10,000,000 to the Securities and Exchange 

Commission for transfer to the general fund of the United States Treasury, subject to Exchange 

Act Section 21F(g)(3). If timely payment is not made, additional interest shall accrue pursuant 

to 31 U.S.C. § 3717. 

Payment must be made in one of the following ways: 

(1) Respondents may transmit payment electronically to the Commission, 

which will provide detailed ACH transfer/Fedwire instructions upon 

request; 

(2) Respondents may make direct payment from a bank account via Pay.gov 

through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or 

(3) Respondents may pay by certified check, bank cashier’s check, or United 

States postal money order, made payable to the Securities and Exchange 

Commission and hand-delivered or mailed to: 

Enterprise Services Center

Accounts Receivable Branch

HQ Bldg., Room 181, AMZ-341

6500 South MacArthur Boulevard

Oklahoma City, OK 73169

Payments by check or money order must be accompanied by a cover letter identifying 

CIR and CIRA as the Respondents in these proceedings, and the file number of these 

proceedings; a copy of the cover letter and check or money order must be sent to Anne C. 

McKinley, Assistant Regional Director, Division of Enforcement, Chicago Regional Office, 175 

West Jackson Boulevard, Suite 1450, Chicago, Illinois 60604. 
12

F. Amounts ordered to be paid as civil money penalties pursuant to this Order shall 

be treated as penalties paid to the government for all purposes, including all tax purposes. To 

preserve the deterrent effect of the civil penalty, Respondents agree that in any Related Investor 

Action, they shall not argue that they are entitled to, nor shall they benefit by, offset or reduction 

of any award of compensatory damages by the amount of any part of Respondents’ payment of a

civil penalty in this action (“Penalty Offset”). If the court in any Related Investor Action grants 

such a Penalty Offset, Respondents agree that they shall, within 30 days after entry of a final 

order granting the Penalty Offset, notify the Commission’s counsel in this action and pay the 

amount of the Penalty Offset to the Securities and Exchange Commission. Such a payment shall 

not be deemed an additional civil penalty and shall not be deemed to change the amount of the 

civil penalty imposed in this proceeding. For purposes of this paragraph, a “Related Investor 

Action” means a private damages action brought against Respondents by or on behalf of one or 

more investors based on substantially the same facts as alleged in the Order instituted by the 

Commission in this proceeding.

By the Commission.

Vanessa A. Countryman

Secretary