ADMINISTRATIVE PROCEEDING
File No. 3-21897 

March 21, 2024 - The Securities and Exchange Commission today charged New York-based attorney Ellen McCarthy with engaging in improper professional conduct.  To settle the SEC’s charges, McCarthy agreed to an order suspending her from appearing or practicing before the Commission pursuant to Rule 102(e)(1)(ii) of the Commission’s Rules of Practice.

The SEC’s order finds that McCarthy violated her obligation to remain independent of Manhattan Transfer Registrar Company (Manhattan Transfer) for two years following her work as engagement manager preparing an independent compliance report for the company.  As set forth in the Order, McCarthy’s work in violation of the independence requirement included serving as engagement manager on the work implementing the Report, despite Commission staff explicitly refusing her request to modify or waive the independence requirement.  The SEC’s order further finds that McCarthy also worked to broker the sale of Manhattan Transfer in violation of the independence requirement. 

The SEC’s order further finds that McCarthy took various steps that she knew or should have known would hide the work she performed for Manhattan Transfer in violation of the independence requirement, including participating in the drafting of a fictitious backdated contract and misleading email sent to Commission staff.  The order also finds that McCarthy also provided false or inaccurate testimony to Commission staff, including denying that she did work for Manhattan Transfer beyond the independent compliance work and that she had any involvement in helping broker the sale of Manhattan Transfer.

The SEC’s order finds that McCarthy violated New York Rule of Professional Conduct 8.4, which states in relevant parts that:

“A lawyer or law firm shall not * * * (d) engage in conduct that is prejudicial to the administration of justice; * * * (h) engage in any other conduct that adversely reflects on a lawyer’s fitness as a lawyer.”

Without admitting or denying the findings, McCarthy consented to an order suspending her from appearing or practicing before the Commission.

The SEC’s investigation was conducted by Eric A. Reicher and Robert R. Berger and supervised by Thomas J. Karr, all in the SEC’s Office of the General Counsel.