In re GlennCap LLC and

 UNITED STATES OF AMERICA 
 Before the 
 SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES ACT OF 1933 
Release No. 11234 / September 14, 2023 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 98392 / September 14, 2023 
 
INVESTMENT ADVISERS ACT OF 1940 
Release No. 6422 / September 14, 2023 
 
INVESTMENT COMPANY ACT OF 1940 
Release No. 34997 / September 14, 2023 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-21667 
 
 
In the Matter of 
 
GlennCap LLC and 
Jonathan Vincent Glenn, 
 
Respondents. 
 
 
 
 
ORDER INSTITUTING ADMINISTRATIVE 
AND CEASE-AND-DESIST PROCEEDINGS 
PURSUANT TO SECTION 8A OF THE 
SECURITIES ACT OF 1933, SECTION 21C 
OF THE SECURITIES EXCHANGE ACT OF 
1934, SECTIONS 203(e), 203(f), AND 203(k) 
OF THE INVESTMENT ADVISERS ACT OF 
1940, AND SECTION 9(b) OF THE 
INVESTMENT COMPANY ACT OF 1940, 
MAKING FINDINGS, AND IMPOSING 
REMEDIAL SANCTIONS AND A CEASE-
AND-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 Section 8A of the Securities Act of 1933 (“Securities Act”), Section 21C of 
the Securities Exchange Act of 1934 (“Exchange Act”), Sections 203(e), 203(f), and 203(k) of the 
Investment Advisers Act of 1940 (“Advisers Act”), and Section 9(b) of the Investment Company 
Act of 1940 (“Investment Company Act”) against GlennCap LLC (“GlennCap”) and Jonathan 
Vincent Glenn (“Glenn”) (collectively, “Respondents”). 
 

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II. 
 
 In anticipation of the institution of these proceedings, Respondents have submitted an Offer 
of Settlement (the “Offer”), which the Commission has determined to accept.  Solely for the 
purpose of these proceedings and any other proceedings brought by or on behalf of the 
Commission, or to which the Commission is a party, and without admitting or denying the findings 
herein, except as to the Commission’s jurisdiction over them and the subject matter of these 
proceedings, which are admitted, and except as provided herein in Section V, Respondents consent 
to the entry of this Order Instituting Administrative and Cease-and-Desist Proceedings Pursuant to 
Section 8A of the Securities Act of 1933, Section 21C of the Securities Exchange Act of 1934, 
Sections 203(e), 203(f), and 203(k) of the Investment Advisers Act of 1940, and Section 9(b) of 
the Investment Company Act of 1940, Making Findings, and Imposing Remedial Sanctions and a 
Cease-and-Desist Order (“Order”), as set forth below. 
 
III. 
 
 On the basis of this Order and Respondents’ Offer, the Commission finds
1
 that: 
 
Summary 
 
 From at least January 2020 to March 2022, GlennCap, acting through Glenn, its sole owner 
and principal, engaged in undisclosed “cherry-picking,” a practice of fraudulently allocating 
profitable trades to favored accounts at the expense of other advisory clients.  Glenn allocated a 
disproportionate number of trades with positive first-day returns to accounts belonging to certain 
favored clients, GlennCap (which Glenn owns), and another account that Glenn controlled, while 
allocating a disproportionate number of trades with negative first-day returns to other client 
accounts.  Glenn accomplished this by executing block trades in GlennCap’s omnibus brokerage 
account and then waiting until later in the day, after he could see whether the positions had 
increased or decreased in value, to allocate the trades to either favored or disfavored accounts.  
Respondents also made false and misleading statements concerning their trading practices in 
GlennCap’s Forms ADV, Part 2A (“Brochures”), which were provided to clients and prospective 
clients.  By virtue of this conduct, Respondents willfully violated Section 17(a) of the Securities 
Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) 
of the Advisers Act. 
 
Respondents 
 
 1. GlennCap LLC is a Connecticut limited liability company with its principal place 
of business in Greenwich, Connecticut.  GlennCap has been registered as an investment adviser 
with the State of Connecticut since January 3, 2018, except for a period from December 31, 2019 to 
January 14, 2020 when GlennCap failed to renew its registration because of insufficient funds in its 
renewals account.  GlennCap has also been registered as an investment adviser with the State of 
 
1
  The findings herein are made pursuant to Respondents’ Offer of Settlement and are not binding on any 
other person or entity in this or any other proceeding. 
 

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New York since April 22, 2019, and on a conditional, restricted basis with the State of Texas since 
January 23, 2020.  According to GlennCap’s Form ADV filed on March 24, 2023, GlennCap 
manages $14 million in assets for 75 clients, all of whom are individual investors. 
 
 2. Jonathan Vincent Glenn, age 53, is a resident of Greenwich, Connecticut, and has 
been the sole owner, principal, employee, and investment adviser representative of GlennCap since 
at least 2018.  Prior to 2018, Glenn was a registered representative associated with multiple broker-
dealers. 
 
Other Relevant Entities 
 
 3. Broker-Dealer A is an SEC-registered broker-dealer.  From 2018 until March 2022, 
Broker-Dealer A provided asset custody and trade execution services to GlennCap.  Broker-Dealer 
A held investment accounts in custody for Glenn, GlennCap, and GlennCap’s advisory clients.  
Broker-Dealer A executed securities transactions in those accounts at the instruction of GlennCap, 
acting through Glenn.  Broker-Dealer A terminated its relationship with GlennCap on March 11, 
2022, effective June 9, 2022. 
 
 4. Broker-Dealer B is an SEC-registered broker-dealer.  Glenn and GlennCap began 
transitioning their own and clients’ accounts to Broker-Dealer B after March 11, 2022.  Broker-
Dealer B provided asset custody and trade execution services to Glenn, GlennCap, and GlennCap’s 
advisory clients starting in May 2022.  Broker-Dealer B executed securities transactions in their 
accounts at the instruction of GlennCap, acting through Glenn. 
 
Background 
 
 5. Glenn founded GlennCap in 2018.  By February 2019, GlennCap had approximately 
$12.5 million in assets under management and approximately 50 clients, all of whom were 
individual investors.  By January 2022, GlennCap’s assets under management had increased to 
approximately $21 million.  Respondents managed client accounts on a discretionary basis and 
charged clients a negotiable annual management fee that was usually about 1.25% of assets under 
management.  Several of GlennCap’s clients also paid annual incentive fees consisting of 20% of 
the positive investment returns in their accounts each year. 
 
 6. From January 2018 to March 2022, Glenn, GlennCap, and GlennCap’s clients all 
had their accounts in custody at Broker-Dealer A, an SEC-registered firm, and Glenn had 
discretionary authority to place trades for the accounts.  Beginning in at least 2020, rather than 
trading directly in clients’ accounts, Glenn often executed trades in GlennCap’s omnibus account at 
Broker-Dealer A.  An omnibus account is an investment account that allows multiple individuals to 
pool their resources and invest as a single entity.  This allowed for block trading (that is, executing 
securities transactions on behalf of multiple accounts simultaneously without necessarily identifying 
the specific individual accounts for which a trade is intended in advance).  After placing a block 
trade in the omnibus account, Glenn would wait before instructing Broker-Dealer A to allocate it 
among individual accounts.  By allocating transactions after he had placed them, Glenn could wait 

 4 
and see how the positions performed over the course of the day and then decide how to allocate 
them based on whether the positions had increased or decreased in value. 
 
 7. GlennCap had a written Code of Ethics that required Respondents to determine and 
document the specific allocation of each block trade prior to execution, and to allocate block trades 
to individual accounts at an average price.  Respondents did not implement these procedures, 
however.  Instead, from January 6, 2020 until December 31, 2020 (“Phase 1”), Glenn 
disproportionately allocated profitable trades (e.g., purchases of securities that increased in price 
from the time of purchase in the omnibus account to time of allocation later that day) to certain 
accounts belonging to two of GlennCap’s clients who paid 20% annual incentive fees and, to a 
lesser degree, to GlennCap’s account, which benefitted Glenn because he owns GlennCap.  At the 
same time, Glenn disproportionately allocated unprofitable trades (e.g., purchases of securities that 
decreased in price from the time of purchase in the omnibus account to time of allocation later that 
day) to GlennCap’s other clients’ accounts.  The preferred accounts obtained average first-day 
returns of approximately 0.44% on allocated equity trades during Phase 1, while GlennCap’s other 
client accounts obtained average first-day returns of approximately -0.35% on allocated equity 
trades.  The difference between the allocations of profitable trades and unprofitable trades is 
statistically significant.  The probability that such a disparate allocation of gains and losses occurred 
by chance is nearly zero. 
 
 8. Thereafter, from January 4, 2021 to March 11, 2022 (“Phase 2”), Glenn 
disproportionately allocated profitable trades to accounts belonging to GlennCap and another 
account that Glenn controlled.  At the same time, Glenn disproportionately allocated unprofitable 
trades to GlennCap’s clients’ accounts.  The favored accounts obtained average first-day returns of 
approximately 0.70% on allocated equity trades during Phase 2, while GlennCap’s client accounts 
obtained average first-day returns of approximately -0.84% on allocated equity trades.  The 
difference between the allocations of profitable trades and unprofitable trades is statistically 
significant.  The probability that such a disparate allocation of gains and losses occurred by chance 
is nearly zero. 
 
 9. On some occasions during Phases 1 and 2, Respondents executed multiple block 
trades in the same security at different prices on the same day.  Some of those block trades were 
profitable at the time of allocation while others were not.  Although GlennCap’s Code of Ethics 
required the Respondents to blend those block trades and allocate them to individual accounts at an 
average price, Respondents did not do that.  Instead, Respondents disproportionately allocated the 
profitable block trades to favored accounts, and they disproportionately allocated the unprofitable 
block trades in the same securities executed on the same day to disfavored accounts. 
 
 10. Respondents benefitted from Glenn’s cherry-picking during Phase 1 through the 
receipt of incentive fees paid by the two favored clients.  Specifically, Respondents received 
approximately $96,542 in net performance fees attributable to Respondents’ cherry-picking during 
Phase 1.  Respondents also received ill-gotten cherry-picking proceeds of at least $2,647,074 during 
Phases 1 and 2. 
 

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 11. In March 2022, Broker-Dealer A notified Respondents that, due to concerns about 
the Respondents’ trading, Broker-Dealer A had terminated GlennCap’s access to the omnibus 
account and would terminate its relationship with GlennCap altogether in 90 days.  Thereafter, 
Glenn asked GlennCap’s clients to move their accounts to Broker-Dealer B, another SEC-registered 
firm.  Broker-Dealer B does not allow investment advisers to use omnibus trading accounts.  As a 
result, Respondents have been unable to cherry-pick profitable trades since March 2022. 
 
 12 From January 2018 to March 2022, Respondents made the following false and 
misleading statements concerning their trading practices in GlennCap’s Forms ADV, Part 2A 
Brochures, which Glenn prepared and filed with the Investment Adviser Registration Depository, 
and which were provided to clients and prospective clients: 
 
a. The Brochures stated that GlennCap would execute securities transactions on 
behalf of clients in accordance with risk tolerance levels as documented in 
individualized investment policy statements.  This statement was false because 
Respondents did not create or utilize investment policy statements, and securities 
transactions on behalf of clients were executed in service of Respondents’ 
cherry-picking scheme and were not based on clients’ risk tolerance levels. 
 
b. The Brochures stated, “GlennCap seeks to provide that investment decisions are 
made in accordance with the fiduciary duties owed to its accounts and without 
consideration of GlennCap’s economic, investment or other financial interests. 
To meet its fiduciary obligations, GlennCap LLC attempts to avoid, among other 
things, investment or trading practices that systematically advantage or 
disadvantage certain client portfolios, and accordingly, GlennCap’s policy is to 
seek fair and equitable allocation of investment opportunities/transactions among 
its clients to avoid favoring one client over another over time.  It is GlennCap's 
policy to allocate investment opportunities and transactions it identifies as being 
appropriate and prudent . . . among its clients on a fair and equitable basis over 
time.”  This statement was false because Respondents did not: (i) seek to make 
investment decisions in accordance with their fiduciary duties and without 
consideration of their own interests; (ii) avoid trading practices that 
systematically advantaged or disadvantaged certain client portfolios; (iii) seek 
fair or equitable allocation of investment opportunities or transactions among 
clients; or (iv) avoid favoring one client over another over time.  To the contrary, 
Respondents made investment decisions in service of a cherry-picking scheme 
that unfairly, inequitably, and systematically favored Respondents and select 
clients while disadvantaging other clients over time. 
 
c. The Brochures stated, “[f]rom time to time, representatives of GlennCap may 
buy or sell securities for themselves that they also recommend to clients.  This 
may provide an opportunity for representatives of GlennCap to buy or sell the 
same securities before or after recommending the same securities to clients 
resulting in representatives profiting off the recommendations they provide to 
clients.  Such transactions may create a conflict of interest.  GlennCap will 

 6 
always document any transactions that could be construed as conflicts of 
interest and will never engage in trading that operates to the client's 
disadvantage when similar securities are being bought or sold.”  This statement 
was false because, in connection with their cherry-picking scheme, Respondents 
often bought and sold securities for themselves before and after buying and 
selling the same securities on behalf of clients in a manner that operated to the 
clients’ disadvantage, and Respondents never documented these transactions. 
 
d. The Brochures stated, “GlennCap will never engage in trading that operates to 
the client’s disadvantage if representatives of GlennCap buy or sell securities at 
or around the same time as clients.”  This statement was false because, in 
connection with their cherry-picking scheme, Respondents often bought and sold 
securities for themselves at or around the same time that they also bought and 
sold the same securities on behalf of clients in a manner that operated to the 
clients’ disadvantage. 
 
e. The Brochures stated that, when GlennCap “aggregate[d] or bunch[ed] 
securities in a single transaction for multiple clients in order to seek more 
favorable prices, lower brokerage commissions, or more efficient execution,” 
GlennCap “would place an aggregate order with the broker on behalf of all such 
clients in order to ensure fairness for all clients; provided, however, that trades 
would be reviewed periodically to ensure that accounts are not systematically 
disadvantaged by this policy.”  This statement was false because Respondents 
often used block trades to effectuate their cherry-picking scheme in a manner 
that systematically disadvantaged clients, and Respondents never reviewed those 
transactions to ensure that they were not systematically disadvantaging clients. 
 
Violations 
 
 13. As a result of the conduct described above, Respondents willfully violated Section 
17(a) of the Securities Act, which prohibits any person, in the offer or sale of any securities by the 
use of any means or instruments of transportation or communication in interstate commerce or by 
use of the mails, directly or indirectly, from employing any device, scheme, or artifice to defraud; 
obtaining money or property by means of any untrue statement of a material fact or any omission 
to state a material fact necessary in order to make the statements made, in light of the 
circumstances under which they were made, not misleading; or engaging in any transaction, 
practice, or course of business which operates or would operate as a fraud or deceit upon the 
purchaser. 
 
 14. As a result of the conduct described above, Respondents willfully violated Section 
10(b) of the Exchange Act and Rule 10b-5 thereunder, which prohibit any person, directly or 
indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of 
any facility of any national securities exchange, in connection with the purchase or sale of any 
security, from employing any deceptive device, scheme, or artifice to defraud; making any untrue 
statement of a material fact or to omitting to state a material fact necessary in order to make the 

 7 
statements made, in the light of the circumstances under which they were made, not misleading; or 
engaging in any act, practice, or course of business that operates as a fraud on any person. 
 
 15. As a result of the conduct described above, Respondents willfully violated Sections 
206(1) and 206(2) of the Advisers Act, which prohibit any investment adviser, by use of the mails 
or any means or instrumentality of interstate commerce, directly or indirectly, from (1) employing 
any device, scheme, or artifice to defraud any client or prospective client, and (2) engaging in any 
transaction, practice, or course of business which operates as a fraud or deceit upon any client or 
prospective client. 
 
Disgorgement 
 
 16. The disgorgement and prejudgment interest ordered in paragraph E of Section IV is 
consistent with equitable principles and does not exceed Respondents’ net profits from their 
violations, and will be distributed to harmed investors to the extent feasible.  The Commission will 
hold funds paid pursuant to paragraph E in an account at the United States Treasury pending 
distribution.  Upon approval of the distribution final accounting by the Commission, any amounts 
remaining that are infeasible to return to investors, and any amounts returned to the Commission in 
the future that are infeasible to return to investors, may be transferred to the general fund of the 
U.S. Treasury, subject to Section 21F(g)(3) of the Exchange Act. 
 
IV. 
 In view of the foregoing, the Commission deems it appropriate, in the public interest to 
impose the sanctions agreed to in the Respondents’ Offer. 
 
 Accordingly, pursuant to Section 8A of the Securities Act, Section 21C of the Exchange 
Act, Sections 203(e), 203(f), and 203(k) of the Advisers Act, and Section 9(b) of the Investment 
Company Act, it is hereby ORDERED that: 
 
 A. Respondents GlennCap and Glenn cease and desist from committing or causing any 
violations and any future violations of Section 17(a) of the Securities Act, Section 10(b) of the 
Exchange Act and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Advisers Act. 
 
B. Respondent Glenn be, and hereby is: 
 
barred from association with any investment adviser, broker, dealer, 
municipal securities dealer, municipal advisor, transfer agent, or nationally 
recognized statistical rating organization; and 
 
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. 
 
C. Respondent GlennCap is censured. 

 8 
 
 D. Any reapplication for association by Respondent Glenn will be subject to the 
applicable laws and regulations governing the reentry process, and reentry may be conditioned 
upon a number of factors, including, but not limited to, compliance with the Commission’s order 
and payment of any or all of the following: (a) any disgorgement or civil penalties ordered by a 
Court against Respondent Glenn in any action brought by the Commission; (b) any disgorgement 
amounts ordered against Respondent Glenn for which the Commission waived payment; (c) any 
arbitration award related to the conduct that served as the basis for the Commission order; (d) any 
self-regulatory organization arbitration award to a customer, whether or not related to the conduct 
that served as the basis for the Commission order; and (e) any restitution order by a self-regulatory 
organization, whether or not related to the conduct that served as the basis for the Commission 
order. 
 
E. Respondents shall, within 14 days of the entry of this Order, pay, jointly and 
severally, disgorgement of $2,743,616 and prejudgment interest of $251,357, and Respondent 
Glenn shall pay a civil money penalty in the amount of $500,000, to the Securities and Exchange 
Commission.  If timely payment of the disgorgement and prejudgment interest is not made, 
additional interest shall accrue pursuant to SEC Rule of Practice 600.  If timely payment of the 
civil money penalty 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 
Glenn and GlennCap as 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 Andrew Dean, 
Co-Chief, Asset Management Unit, Division of Enforcement, U.S. Securities and Exchange 
Commission, New York Regional Office, 100 Pearl St., Suite 20-100, New York, NY 10004-2616. 
 

 9 
 F.  Pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, a Fair Fund is 
created for the disgorgement, prejudgment interest and penalties referenced in paragraph IV.E. 
above.  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, Respondent Glenn agrees that in any Related Investor Action, 
he shall not argue that he is entitled to, nor shall he benefit by, offset or reduction of any award of 
compensatory damages by the amount of any part of Respondent Glenn’s payment of a civil 
penalty in this action (“Penalty Offset”).  If the court in any Related Investor Action grants such a 
Penalty Offset, Respondent Glenn agrees that he 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 Respondent Glenn 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. 
 
V. 
It is further Ordered that, solely for purposes of exceptions to discharge set forth in Section 
523 of the Bankruptcy Code, 11 U.S.C. §523, the findings in this Order are true and admitted by 
Respondent Glenn, and further, any debt for disgorgement, prejudgment interest, civil penalty or 
other amounts due by Respondent Glenn under this Order or any other judgment, order, consent 
order, decree or settlement agreement entered in connection with this proceeding, is a debt for the 
violation by Respondent Glenn of the federal securities laws or any regulation or order issued 
under such laws, as set forth in Section 523(a)(19) of the Bankruptcy Code, 11 U.S.C. §523(a)(19). 
 
 By the Commission. 
 
 
 
Vanessa A. Countryman 
        Secretary 
 

UNITED STATES OF AMERICA 

 Before the 

 SECURITIES AND EXCHANGE COMMISSION 

 

SECURITIES ACT OF 1933 

Release No. 11234 / September 14, 2023 

 

SECURITIES EXCHANGE ACT OF 1934 

Release No. 98392 / September 14, 2023 

 

INVESTMENT ADVISERS ACT OF 1940 

Release No. 6422 / September 14, 2023 

 

INVESTMENT COMPANY ACT OF 1940 

Release No. 34997 / September 14, 2023 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-21667 

 

 

In the Matter of 

 

GlennCap LLC and 

Jonathan Vincent Glenn, 

 

Respondents. 

 

 

 

 

ORDER INSTITUTING ADMINISTRATIVE 

AND CEASE-AND-DESIST PROCEEDINGS 

PURSUANT TO SECTION 8A OF THE 

SECURITIES ACT OF 1933, SECTION 21C 

OF THE SECURITIES EXCHANGE ACT OF 

1934, SECTIONS 203(e), 203(f), AND 203(k) 

OF THE INVESTMENT ADVISERS ACT OF 

1940, AND SECTION 9(b) OF THE 

INVESTMENT COMPANY ACT OF 1940, 

MAKING FINDINGS, AND IMPOSING 

REMEDIAL SANCTIONS AND A CEASE-

AND-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 Section 8A of the Securities Act of 1933 (“Securities Act”), Section 21C of 

the Securities Exchange Act of 1934 (“Exchange Act”), Sections 203(e), 203(f), and 203(k) of the 

Investment Advisers Act of 1940 (“Advisers Act”), and Section 9(b) of the Investment Company 

Act of 1940 (“Investment Company Act”) against GlennCap LLC (“GlennCap”) and Jonathan 

Vincent Glenn (“Glenn”) (collectively, “Respondents”). 

 



 2 

II. 

 

 In anticipation of the institution of these proceedings, Respondents have submitted an Offer 

of Settlement (the “Offer”), which the Commission has determined to accept.  Solely for the 

purpose of these proceedings and any other proceedings brought by or on behalf of the 

Commission, or to which the Commission is a party, and without admitting or denying the findings 

herein, except as to the Commission’s jurisdiction over them and the subject matter of these 

proceedings, which are admitted, and except as provided herein in Section V, Respondents consent 

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

Section 8A of the Securities Act of 1933, Section 21C of the Securities Exchange Act of 1934, 

Sections 203(e), 203(f), and 203(k) of the Investment Advisers Act of 1940, and Section 9(b) of 

the Investment Company Act of 1940, Making Findings, and Imposing Remedial Sanctions and a 

Cease-and-Desist Order (“Order”), as set forth below. 

 

III. 

 

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

 

Summary 

 

 From at least January 2020 to March 2022, GlennCap, acting through Glenn, its sole owner 

and principal, engaged in undisclosed “cherry-picking,” a practice of fraudulently allocating 

profitable trades to favored accounts at the expense of other advisory clients.  Glenn allocated a 

disproportionate number of trades with positive first-day returns to accounts belonging to certain 

favored clients, GlennCap (which Glenn owns), and another account that Glenn controlled, while 

allocating a disproportionate number of trades with negative first-day returns to other client 

accounts.  Glenn accomplished this by executing block trades in GlennCap’s omnibus brokerage 

account and then waiting until later in the day, after he could see whether the positions had 

increased or decreased in value, to allocate the trades to either favored or disfavored accounts.  

Respondents also made false and misleading statements concerning their trading practices in 

GlennCap’s Forms ADV, Part 2A (“Brochures”), which were provided to clients and prospective 

clients.  By virtue of this conduct, Respondents willfully violated Section 17(a) of the Securities 

Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) 

of the Advisers Act. 

 

Respondents 

 

 1. GlennCap LLC is a Connecticut limited liability company with its principal place 

of business in Greenwich, Connecticut.  GlennCap has been registered as an investment adviser 

with the State of Connecticut since January 3, 2018, except for a period from December 31, 2019 to 

January 14, 2020 when GlennCap failed to renew its registration because of insufficient funds in its 

renewals account.  GlennCap has also been registered as an investment adviser with the State of 

 
1  The findings herein are made pursuant to Respondents’ Offer of Settlement and are not binding on any 

other person or entity in this or any other proceeding. 
 



 3 

New York since April 22, 2019, and on a conditional, restricted basis with the State of Texas since 

January 23, 2020.  According to GlennCap’s Form ADV filed on March 24, 2023, GlennCap 

manages $14 million in assets for 75 clients, all of whom are individual investors. 

 

 2. Jonathan Vincent Glenn, age 53, is a resident of Greenwich, Connecticut, and has 

been the sole owner, principal, employee, and investment adviser representative of GlennCap since 

at least 2018.  Prior to 2018, Glenn was a registered representative associated with multiple broker-

dealers. 

 

Other Relevant Entities 

 

 3. Broker-Dealer A is an SEC-registered broker-dealer.  From 2018 until March 2022, 

Broker-Dealer A provided asset custody and trade execution services to GlennCap.  Broker-Dealer 

A held investment accounts in custody for Glenn, GlennCap, and GlennCap’s advisory clients.  

Broker-Dealer A executed securities transactions in those accounts at the instruction of GlennCap, 

acting through Glenn.  Broker-Dealer A terminated its relationship with GlennCap on March 11, 

2022, effective June 9, 2022. 

 

 4. Broker-Dealer B is an SEC-registered broker-dealer.  Glenn and GlennCap began 

transitioning their own and clients’ accounts to Broker-Dealer B after March 11, 2022.  Broker-

Dealer B provided asset custody and trade execution services to Glenn, GlennCap, and GlennCap’s 

advisory clients starting in May 2022.  Broker-Dealer B executed securities transactions in their 

accounts at the instruction of GlennCap, acting through Glenn. 

 

Background 

 

 5. Glenn founded GlennCap in 2018.  By February 2019, GlennCap had approximately 

$12.5 million in assets under management and approximately 50 clients, all of whom were 

individual investors.  By January 2022, GlennCap’s assets under management had increased to 

approximately $21 million.  Respondents managed client accounts on a discretionary basis and 

charged clients a negotiable annual management fee that was usually about 1.25% of assets under 

management.  Several of GlennCap’s clients also paid annual incentive fees consisting of 20% of 

the positive investment returns in their accounts each year. 

 

 6. From January 2018 to March 2022, Glenn, GlennCap, and GlennCap’s clients all 

had their accounts in custody at Broker-Dealer A, an SEC-registered firm, and Glenn had 

discretionary authority to place trades for the accounts.  Beginning in at least 2020, rather than 

trading directly in clients’ accounts, Glenn often executed trades in GlennCap’s omnibus account at 

Broker-Dealer A.  An omnibus account is an investment account that allows multiple individuals to 

pool their resources and invest as a single entity.  This allowed for block trading (that is, executing 

securities transactions on behalf of multiple accounts simultaneously without necessarily identifying 

the specific individual accounts for which a trade is intended in advance).  After placing a block 

trade in the omnibus account, Glenn would wait before instructing Broker-Dealer A to allocate it 

among individual accounts.  By allocating transactions after he had placed them, Glenn could wait 



 4 

and see how the positions performed over the course of the day and then decide how to allocate 

them based on whether the positions had increased or decreased in value. 

 

 7. GlennCap had a written Code of Ethics that required Respondents to determine and 

document the specific allocation of each block trade prior to execution, and to allocate block trades 

to individual accounts at an average price.  Respondents did not implement these procedures, 

however.  Instead, from January 6, 2020 until December 31, 2020 (“Phase 1”), Glenn 

disproportionately allocated profitable trades (e.g., purchases of securities that increased in price 

from the time of purchase in the omnibus account to time of allocation later that day) to certain 

accounts belonging to two of GlennCap’s clients who paid 20% annual incentive fees and, to a 

lesser degree, to GlennCap’s account, which benefitted Glenn because he owns GlennCap.  At the 

same time, Glenn disproportionately allocated unprofitable trades (e.g., purchases of securities that 

decreased in price from the time of purchase in the omnibus account to time of allocation later that 

day) to GlennCap’s other clients’ accounts.  The preferred accounts obtained average first-day 

returns of approximately 0.44% on allocated equity trades during Phase 1, while GlennCap’s other 

client accounts obtained average first-day returns of approximately -0.35% on allocated equity 

trades.  The difference between the allocations of profitable trades and unprofitable trades is 

statistically significant.  The probability that such a disparate allocation of gains and losses occurred 

by chance is nearly zero. 

 

 8. Thereafter, from January 4, 2021 to March 11, 2022 (“Phase 2”), Glenn 

disproportionately allocated profitable trades to accounts belonging to GlennCap and another 

account that Glenn controlled.  At the same time, Glenn disproportionately allocated unprofitable 

trades to GlennCap’s clients’ accounts.  The favored accounts obtained average first-day returns of 

approximately 0.70% on allocated equity trades during Phase 2, while GlennCap’s client accounts 

obtained average first-day returns of approximately -0.84% on allocated equity trades.  The 

difference between the allocations of profitable trades and unprofitable trades is statistically 

significant.  The probability that such a disparate allocation of gains and losses occurred by chance 

is nearly zero. 

 

 9. On some occasions during Phases 1 and 2, Respondents executed multiple block 

trades in the same security at different prices on the same day.  Some of those block trades were 

profitable at the time of allocation while others were not.  Although GlennCap’s Code of Ethics 

required the Respondents to blend those block trades and allocate them to individual accounts at an 

average price, Respondents did not do that.  Instead, Respondents disproportionately allocated the 

profitable block trades to favored accounts, and they disproportionately allocated the unprofitable 

block trades in the same securities executed on the same day to disfavored accounts. 

 

 10. Respondents benefitted from Glenn’s cherry-picking during Phase 1 through the 

receipt of incentive fees paid by the two favored clients.  Specifically, Respondents received 

approximately $96,542 in net performance fees attributable to Respondents’ cherry-picking during 

Phase 1.  Respondents also received ill-gotten cherry-picking proceeds of at least $2,647,074 during 

Phases 1 and 2. 

 



 5 

 11. In March 2022, Broker-Dealer A notified Respondents that, due to concerns about 

the Respondents’ trading, Broker-Dealer A had terminated GlennCap’s access to the omnibus 

account and would terminate its relationship with GlennCap altogether in 90 days.  Thereafter, 

Glenn asked GlennCap’s clients to move their accounts to Broker-Dealer B, another SEC-registered 

firm.  Broker-Dealer B does not allow investment advisers to use omnibus trading accounts.  As a 

result, Respondents have been unable to cherry-pick profitable trades since March 2022. 

 

 12 From January 2018 to March 2022, Respondents made the following false and 

misleading statements concerning their trading practices in GlennCap’s Forms ADV, Part 2A 

Brochures, which Glenn prepared and filed with the Investment Adviser Registration Depository, 

and which were provided to clients and prospective clients: 

 

a. The Brochures stated that GlennCap would execute securities transactions on 

behalf of clients in accordance with risk tolerance levels as documented in 

individualized investment policy statements.  This statement was false because 

Respondents did not create or utilize investment policy statements, and securities 

transactions on behalf of clients were executed in service of Respondents’ 

cherry-picking scheme and were not based on clients’ risk tolerance levels. 

 

b. The Brochures stated, “GlennCap seeks to provide that investment decisions are 

made in accordance with the fiduciary duties owed to its accounts and without 

consideration of GlennCap’s economic, investment or other financial interests. 

To meet its fiduciary obligations, GlennCap LLC attempts to avoid, among other 

things, investment or trading practices that systematically advantage or 

disadvantage certain client portfolios, and accordingly, GlennCap’s policy is to 

seek fair and equitable allocation of investment opportunities/transactions among 

its clients to avoid favoring one client over another over time.  It is GlennCap's 

policy to allocate investment opportunities and transactions it identifies as being 

appropriate and prudent . . . among its clients on a fair and equitable basis over 

time.”  This statement was false because Respondents did not: (i) seek to make 

investment decisions in accordance with their fiduciary duties and without 

consideration of their own interests; (ii) avoid trading practices that 

systematically advantaged or disadvantaged certain client portfolios; (iii) seek 

fair or equitable allocation of investment opportunities or transactions among 

clients; or (iv) avoid favoring one client over another over time.  To the contrary, 

Respondents made investment decisions in service of a cherry-picking scheme 

that unfairly, inequitably, and systematically favored Respondents and select 

clients while disadvantaging other clients over time. 

 

c. The Brochures stated, “[f]rom time to time, representatives of GlennCap may 

buy or sell securities for themselves that they also recommend to clients.  This 

may provide an opportunity for representatives of GlennCap to buy or sell the 

same securities before or after recommending the same securities to clients 

resulting in representatives profiting off the recommendations they provide to 

clients.  Such transactions may create a conflict of interest.  GlennCap will 



 6 

always document any transactions that could be construed as conflicts of 

interest and will never engage in trading that operates to the client's 

disadvantage when similar securities are being bought or sold.”  This statement 

was false because, in connection with their cherry-picking scheme, Respondents 

often bought and sold securities for themselves before and after buying and 

selling the same securities on behalf of clients in a manner that operated to the 

clients’ disadvantage, and Respondents never documented these transactions. 

 

d. The Brochures stated, “GlennCap will never engage in trading that operates to 

the client’s disadvantage if representatives of GlennCap buy or sell securities at 

or around the same time as clients.”  This statement was false because, in 

connection with their cherry-picking scheme, Respondents often bought and sold 

securities for themselves at or around the same time that they also bought and 

sold the same securities on behalf of clients in a manner that operated to the 

clients’ disadvantage. 

 

e. The Brochures stated that, when GlennCap “aggregate[d] or bunch[ed] 

securities in a single transaction for multiple clients in order to seek more 

favorable prices, lower brokerage commissions, or more efficient execution,” 

GlennCap “would place an aggregate order with the broker on behalf of all such 

clients in order to ensure fairness for all clients; provided, however, that trades 

would be reviewed periodically to ensure that accounts are not systematically 

disadvantaged by this policy.”  This statement was false because Respondents 

often used block trades to effectuate their cherry-picking scheme in a manner 

that systematically disadvantaged clients, and Respondents never reviewed those 

transactions to ensure that they were not systematically disadvantaging clients. 

 

Violations 

 

 13. As a result of the conduct described above, Respondents willfully violated Section 

17(a) of the Securities Act, which prohibits any person, in the offer or sale of any securities by the 

use of any means or instruments of transportation or communication in interstate commerce or by 

use of the mails, directly or indirectly, from employing any device, scheme, or artifice to defraud; 

obtaining money or property by means of any untrue statement of a material fact or any omission 

to state a material fact necessary in order to make the statements made, in light of the 

circumstances under which they were made, not misleading; or engaging in any transaction, 

practice, or course of business which operates or would operate as a fraud or deceit upon the 

purchaser. 

 

 14. As a result of the conduct described above, Respondents willfully violated Section 

10(b) of the Exchange Act and Rule 10b-5 thereunder, which prohibit any person, directly or 

indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of 

any facility of any national securities exchange, in connection with the purchase or sale of any 

security, from employing any deceptive device, scheme, or artifice to defraud; making any untrue 

statement of a material fact or to omitting to state a material fact necessary in order to make the 



 7 

statements made, in the light of the circumstances under which they were made, not misleading; or 

engaging in any act, practice, or course of business that operates as a fraud on any person. 

 

 15. As a result of the conduct described above, Respondents willfully violated Sections 

206(1) and 206(2) of the Advisers Act, which prohibit any investment adviser, by use of the mails 

or any means or instrumentality of interstate commerce, directly or indirectly, from (1) employing 

any device, scheme, or artifice to defraud any client or prospective client, and (2) engaging in any 

transaction, practice, or course of business which operates as a fraud or deceit upon any client or 

prospective client. 

 

Disgorgement 

 

 16. The disgorgement and prejudgment interest ordered in paragraph E of Section IV is 

consistent with equitable principles and does not exceed Respondents’ net profits from their 

violations, and will be distributed to harmed investors to the extent feasible.  The Commission will 

hold funds paid pursuant to paragraph E in an account at the United States Treasury pending 

distribution.  Upon approval of the distribution final accounting by the Commission, any amounts 

remaining that are infeasible to return to investors, and any amounts returned to the Commission in 

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

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

 

IV. 

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

impose the sanctions agreed to in the Respondents’ Offer. 

 

 Accordingly, pursuant to Section 8A of the Securities Act, Section 21C of the Exchange 

Act, Sections 203(e), 203(f), and 203(k) of the Advisers Act, and Section 9(b) of the Investment 

Company Act, it is hereby ORDERED that: 

 

 A. Respondents GlennCap and Glenn cease and desist from committing or causing any 

violations and any future violations of Section 17(a) of the Securities Act, Section 10(b) of the 

Exchange Act and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Advisers Act. 

 

B. Respondent Glenn be, and hereby is: 

 

barred from association with any investment adviser, broker, dealer, 

municipal securities dealer, municipal advisor, transfer agent, or nationally 

recognized statistical rating organization; and 

 

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. 

 

C. Respondent GlennCap is censured. 



 8 

 

 D. Any reapplication for association by Respondent Glenn will be subject to the 

applicable laws and regulations governing the reentry process, and reentry may be conditioned 

upon a number of factors, including, but not limited to, compliance with the Commission’s order 

and payment of any or all of the following: (a) any disgorgement or civil penalties ordered by a 

Court against Respondent Glenn in any action brought by the Commission; (b) any disgorgement 

amounts ordered against Respondent Glenn for which the Commission waived payment; (c) any 

arbitration award related to the conduct that served as the basis for the Commission order; (d) any 

self-regulatory organization arbitration award to a customer, whether or not related to the conduct 

that served as the basis for the Commission order; and (e) any restitution order by a self-regulatory 

organization, whether or not related to the conduct that served as the basis for the Commission 

order. 

 

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

severally, disgorgement of $2,743,616 and prejudgment interest of $251,357, and Respondent 

Glenn shall pay a civil money penalty in the amount of $500,000, to the Securities and Exchange 

Commission.  If timely payment of the disgorgement and prejudgment interest is not made, 

additional interest shall accrue pursuant to SEC Rule of Practice 600.  If timely payment of the 

civil money penalty 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 

Glenn and GlennCap as 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 Andrew Dean, 

Co-Chief, Asset Management Unit, Division of Enforcement, U.S. Securities and Exchange 

Commission, New York Regional Office, 100 Pearl St., Suite 20-100, New York, NY 10004-2616. 

 

http://www.sec.gov/about/offices/ofm.htm


 9 

 F.  Pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, a Fair Fund is 

created for the disgorgement, prejudgment interest and penalties referenced in paragraph IV.E. 

above.  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, Respondent Glenn agrees that in any Related Investor Action, 

he shall not argue that he is entitled to, nor shall he benefit by, offset or reduction of any award of 

compensatory damages by the amount of any part of Respondent Glenn’s payment of a civil 

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

Penalty Offset, Respondent Glenn agrees that he 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 Respondent Glenn 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. 

 

V. 

It is further Ordered that, solely for purposes of exceptions to discharge set forth in Section 

523 of the Bankruptcy Code, 11 U.S.C. §523, the findings in this Order are true and admitted by 

Respondent Glenn, and further, any debt for disgorgement, prejudgment interest, civil penalty or 

other amounts due by Respondent Glenn under this Order or any other judgment, order, consent 

order, decree or settlement agreement entered in connection with this proceeding, is a debt for the 

violation by Respondent Glenn of the federal securities laws or any regulation or order issued 

under such laws, as set forth in Section 523(a)(19) of the Bankruptcy Code, 11 U.S.C. §523(a)(19). 

 

 By the Commission. 

 

 

 

Vanessa A. Countryman 

        Secretary