UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934

Release No. 89785 / September 8, 2020

ADMINISTRATIVE PROCEEDING

File No. 3-19965

In the Matter of

Alexander S. Gould,

Respondent.

ORDER DIRECTING PAYMENT OF 

CERTAIN FUNDS RECEIVED BY THE 

COMMISSION

On September 8, 2020, the Securities and Exchange Commission (“Commission”) issued 

an Order (the “Order”)1that simultaneously instituted and settled public administrative and ceaseand-desist proceedings against Alexander S. Gould (“Gould”). The Commission found that in 

2018, Gould, an investment adviser to a private fund, diverted the fund’s money to pay for his 

personal expenses, in violation of Sections 206(1) and 206(2) of the Investment Advisers Act of 

1940 (the “Advisers Act”). The Commission ordered Gould to cease and desist from committing 

or causing any violations and any future violations of Sections 206(1) and 206(2) of the Advisers 

Act. The Commission also ordered that Gould be

(i) barred from association with any broker, dealer, investment adviser, municipal securities 

dealer, municipal advisor, transfer agent, or nationally recognized statistical rating 

organization, and

(ii) prohibited from serving or acting as an employee, officer, director, member of an 

advisory board, investment adviser or depositor of, or principal underwriter for, a 

registered investment company or affiliated person of such investment adviser, 

depositor, or principal underwriter,

with the right to apply for reentry after five (5) years to the appropriate self-regulatory organization, 

or if there is none, to the Commission. The Commission further ordered Gould to pay disgorgement 

of $476,033.19, prejudgment interest of $50,137.33, and civil penalties of $200,000. The 

Commission created a Fair Fund (the “Fair Fund”) pursuant to Section 308(a) of the SarbanesOxley Act of 2002 so the disgorgement, prejudgment interest, and civil penalty could be

 

1

Investment Advisers Act Rel. No. 5574 (Sept. 8, 2020).
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distributed to the investors that were harmed by Gould’s violations as described in the Order (the 

“Investors”).

The payment of disgorgement, prejudgment interest, and civil penalty constitutes 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. 

After receipt of the disgorgement, interest, and penalty amounts referenced above, the 

Commission staff will seek the appointment of a tax administrator to establish a reserve for taxes and 

related administrative expenses (the “Reserve”). Upon establishing and withholding the Reserve, the 

Commission staff shall disburse $526,169.01 to the Investors, which is the total loss to the Investors

due to the violations described in the Order as determined by the Commission staff, plus reasonable 

interest.2 The distribution to each Investor as determined by the Commission staff is reflected in 

Exhibit 1. After the distribution payments and all taxes and administrative expenses are paid, the 

Commission staff will transfer the remaining funds, if any, that are infeasible to return to investors, 

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 ORDERED that: 

A. After the receipt of funds simultaneously ordered in this proceeding, the Commission 

staff shall seek the appointment of a tax administrator to, among other things, comply 

with tax-related obligations of the QSF and establish the Reserve; 

B. After withholding the Reserve, the Commission staff shall disburse $526,169.01 to 

the Investors as set forth in Exhibit 1; and 

C. Any amounts remaining in the Fair Fund after completion of A and B above, that are 

infeasible to return to investors, and any amounts returned to the Fair Fund in the 

future that are infeasible to return to investors, shall be transferred to the general fund 

of the U.S. Treasury, subject to Section 21F(g)(3) of the Exchange Act.

By the Commission.

Vanessa A. Countryman

Secretary

 

2 This amount includes reasonable interest calculated using the short-term Applicable Federal

Rate plus three percentage points, compounded quarterly from July 25, 2018, through June 30,

2020.
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Exhibit 1

Investor Amount

Investor A $169,740.70

Investor B $84,870.35

Investor C $67,896.28

Investor D $135,765.40

Investor E $33,948.14

Investor F $33,948.14

Total $526,169.01