Equinox Fund Management, LLC settled charges brought by the Commodity Futures Trading Commission that, from 2004 to March 2011, it made material misstatements and omissions in connection with its operation of a multi-advisor commodity pool known as the Frontier Fund. The CFTC alleged that, during the relevant time period, Equinox, a CFTC-registered commodity pool operator, assessed management fees based on the value of the Frontier Fund’s notional assets (i.e., invested assets plus leverage). However, the Fund’s disclosure documents advised investors that management fees would only be assessed on the fund’s net asset value. In addition, the 2010 annual report for the Frontier Fund said that the value of certain over-the-counter options held by the fund were “corroborated by weekly counterparty settlement values,” when this was not the case. The CFTC’s enforcement action followed by two months Equinox’s settlement of a similar action brought by the Securities and Exchange Commission for the same underlying facts. (Click here for details regarding the SEC’s lawsuit in the article, “Fund Manager Sanctioned by SEC for Overcharging Fees and Misleading Investors About Asset Valuation” in the January 24, 2016 edition of Bridging the Week.) To resolve the CFTC lawsuit, Equinox agreed to pay a fine of US $250,000 and disgorgement of $5.4 million. However, Equinox may offset any disgorgement payment it makes dollar-for-dollar under the terms of its settlement with the SEC to its obligation under its CFTC settlement.