A Securities and Exchange Commission judge has ordered a San Diego-based investment firm to pay a $15 million penalty and barred its two advisers from the securities industry for a scheme that defrauded clients out of $10.9 million. Chief Administrative Law Judge Brenda P. Murray ruled that J.S. Oliver Capital Management LP and the two advisers, who included the firm's founder, breached their responsibilities to act in their clients' best interests and committed other securities law violations. Murray ruled that the firm and advisers had engaged in "cherry-picking," or awarding more profitable trades to favored clients. They had also misused "soft dollars," or credits from brokerage firms on commissions that investment advisers' clients pay for trades, according to a 64-page opinion dated Tuesday. J.S. Oliver Capital Management must also pay $1.4 million in disgorgement, a type of penalty that effectively forces those who have engaged in wrongdoing to give up profits they obtained
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