[ by Howard Haykin ]

Peter Eichler Jr., chief executive of Aletheia Research and Management, received a so-called Wells notice, indicating the SEC is considering enforcement action.  The potential lawsuit was disclosed by an staff attorney during a hearing in U.S. Bankruptcy Court in L.A. related to Aletheia's filing for bankruptcy protection on 11/11/12 - the firm owes as much as $50 million.   A bankruptcy lawyer for Aletheia, Brian Davidoff, said that his client disputed the SEC's possible claims.

Earlier in November, C-I reported that the SEC was investigating Mr. Eichler, 54, principally into the money manager's trading practices.  [See WHO'S News posting on 11/12/12, "High Profile L.A. Money Manager Targeted by SEC."]

Eichler's firm, Aletheia, primarily manages stock portfolios for pension funds, foundations and wealthy families.  Its strong investment performance - Aletheia's flagship growth strategy has substantially outperformed the S&P 500-stock index over the last decade - has attracted marquee clients, including Michigan's state pension fund, the Ewing Marion Kauffman Foundation in K.C., MO, as well as investments from clients of Goldman Sachs and Morgan Stanley.  

Justice Department Wants a Piece.   The DOJ also has taken an interest in Aletheia's bankruptcy case. On Monday, prosecutors in the tax division of the U.S. Attorney's office in Los Angeles requested that the bankruptcy court keep it notified of all pleadings in the case.

Eichler, a once highly regarded money manager, managing nearly $10 billion in assets, and Aletheia have been under a cloud since 2010, when then-senior executive Roger Peikin filed an explosive wrongful-termination lawsuit.  In the suit, he depicted Eichler as a tyrannical boss who ruled "with an iron fist" and operated the firm as his "personal fiefdom."  Peikin further noted misconduct by Eichler related to "general disregard for regulatory controls, wanton expenditure of corporate assets for Eichler's personal benefit, and overall neglect of the business side of Aletheia's operations."

For further details, go to:   [Dealbook, 11/21/12].