In the Matter of Michael R. Pelosi, Adm. Proc. File No. 3-14194 (Jan. 14, 2011) is a proceeding against the former portfolio manager at registered investment adviser Halsey Associates, Inc. According to the Order, over a three year period beginning in 2005 Mr. Pelosi repeatedly falsified performance returns to clients in periodic correspondence. He exaggerated account gains and minimized performance losses in violation of Advisers Act Sections 206(1) and 206(2). The matter is in litigation.