Fund Manager to Be Barred from Leading Company in SEC Agreement

Former fund manager Naufal Sanaullah agreed to never serving as a public-company officer, as part of resolving a Securities and Exchange Commission enforcement action that says he lied to investors about risk management and his education.

From 2017 to 2021, Sanaullah allegedly solicited investors to an EIA All Weather Alpha Fund I Partners, LLC fund by lying about his managing of risk and having a college degree, violating anti-fraud provisions of federal securities laws, the SEC said Thursday in the parties’ agreed motion for entry to consent judgment against Sanaullah in the US District Court for the Eastern District of Michigan..

Pending a judge’s approval, he will also pay disgorgement, prejudgment interest, and civil penalties to be determined by the court upon an SEC motion, the commission said.

Sanaullah won’t publicly deny the allegations, according to the consent he signed that’s dated Dec. 9 and attached to the motion. He waived the entry of findings of fact and conclusions of law and right to appeal.

As EIA’s chief macro strategist and risk officer, Sanaullah claimed he’d graduated with a mathematics degree from the University of Michigan, when he merely attended the school, said the SEC’s complaint docketed the same day as the motion. When he’d resigned from EIA in October 2021, the fund had collected over $34 million in investments from more than 100 investors, the commission said. From August 2019 to 2021, Sanaullah earned $553,000, it said.

Statements he and the fund put forward made it seem like he was monitoring and managing risks, but behind the scenes he repeatedly discussed with the founder and CEO that the fund was failing to follow any risk management protocols, the SEC said.

In 2022, the SEC obtained emergency relief freezing the assets of EIA due to an alleged $39 million fraud scheme. Former EIA CEO Andrew H. Middlebrooks was charged by the SEC then later by the US Department of Justice with one count of wire fraud in a Criminal Information, to which he pleaded guilty. The SEC’s case was administratively closed pending Middlebrooks’ sentencing.

The court will hold the allegations against Sanaullah as true for purposes of the judgment, the motion read.

Stradley Ronon Stevens & Young, LLP represents Sanaullah. His attorney didn’t immediately respond to an email seeking comment.

The case is SEC v. Sanaullah, E.D. Mich., No. 2:25-cv-10165, 1/16/25.