UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934

Release No. 88144 / February 7, 2020

ADMINISTRATIVE PROCEEDING

File No. 3-19511

In the Matter of

Leonardo Cornide and 

Jorge Falcon,

Respondents.

ORDER DIRECTING PAYMENT OF 

CERTAIN FUNDS RECEIVED BY THE 

COMMISSION

On January 24, 2020, the Commission issued an Amended Order Instituting Cease-andDesist Proceedings Pursuant to Section 203(k) of the Investment Advisers Act of 1940, Making 

Findings, and Imposing a Cease-and-Desist Order (the “Amended Order”)1that amended the 

order issued on September 25, 2019,2 which simultaneously instituted and settled a cease-anddesist proceeding against Leonardo Cornide (“Cornide”) and Jorge Falcon (“Falcon”) (together 

“Respondents”). These proceedings arise out of Respondents’ failure to disclose conflicts of 

interest while acting as investment advisers to Premier Assurance Group, SPC Ltd. (“PSPC”), a 

Cayman Islands-registered insurance company. 

In the Amended Order, the Commission ordered Respondents to cease and desist from 

committing or causing any violations and any future violations of Section 206(2) of the 

Investment Advisers Act of 1940. The Commission ordered Respondents to obtain the services 

of an independent compliance consultant to review and recommend certain policies and 

procedures relating to conflicts of interest.

The Commission ordered Cornide to pay disgorgement of $2,786,925 plus accrued 

interest of $274,107.19, of which $655,350 was previously paid to PSPC; and Falcon to pay 

disgorgement of $4,390,278 plus accrued interest of $414,630.27, of which $920,349.82 was 

previously paid to PSPC. The remaining disgorgement and accrued interest was ordered to be 

paid in four installments, with such payments to be completed within 360 days of the entry of 

the Order. The Commission also ordered the Respondents to each pay a $100,000 civil money 

 

1

 See Advisers Act Rel. No. 5366A (Jan. 24, 2020).

2

 Order Instituting Cease-and-Desist Proceedings Pursuant to Section 203(k) of the Investment Advisers Act of 

1940, Making Findings, and Imposing a Cease-and-Desist Order, Advisers Act Rel. No. 5366 (Sept. 25, 2019).
2

penalty to the Commission, and created a Fair Fund, pursuant to Section 308(a) of the SarbanesOxley Act of 2002, so the penalties could be included with the disgorgement and accrued 

interest to be collected for distribution (the “Fair Fund”). 

The Respondents paid the $200,000 in civil penalties, as ordered, into the Fair Fund, and 

any additional payments received pursuant to the Amended Order will be added to the Fair Fund 

for distribution.

The Commission is in receipt of the first payment of $800,000, as detailed in the 

Amended Order. The Commission staff shall disburse said funds from the Fair Fund to PSPC. 

Upon receipt of additional payments, pursuant to the Amended Order, the Commission 

staff will seek a Commission order to distribute such amounts received to PSPC within 

approximately 30 days of receipt of said payments. The result, after the final disbursement from 

the Fair Fund, including the funds already credited and received by PSPC (detailed in the 

Amended Order), shall be the return to PSPC of the $6.8 million, plus interest, Cornide and 

Falcon loaned to themselves. 

Commission staff will seek the appointment of a tax administrator for the Fair Fund as it 

constitutes a payment from a qualified settlement fund (“QSF”) under Section of 468B(g) of the 

Internal Revenue Code (IRC), 26 U.S.C. § 468B(g), and related regulations, 26 C.F.R. §§ 

1.468B-1 through 1.468B-5. Taxes, if any, and related administrative expenses shall be paid 

from the Fair Fund. After the final distribution of funds and all taxes and administrative

expenses are paid, the Commission staff will seek a Commission order to transfer the remaining 

funds, if any, to the general fund of the United States Treasury subject to Section 21F(g)(3) of 

the Securities Exchange Act of 1934 (“Exchange Act”). 

Accordingly, it is hereby ORDERED that:

A. The Commission staff shall seek appointment of a tax administrator to, among 

other things, comply with tax-related obligations of the QSF and all taxes and 

administrative expenses shall be paid from the Fair Fund; and

B. The Commission staff shall disburse $800,000 from the Fair Fund to PSPC, so 

those funds may be placed into PSPC’s reserve accounts.

By the Commission.

Vanessa A. Countryman

Secretary