A federal court has placed the investment funds managed by New York adviser SQN Capital Management LLC into receivership. The order resolves a settled SEC action against the firm and its president and chief executive, Jeremiah Silkowski. Consent judgments entered October 8 in the Southern District of New York cap a case that accused Silkowski of inflating fund values for years while investors waited to get their money back.
What happened to SQN Capital Management
The SEC filed its complaint on September 18, 2026, in the U.S. District Court for the Southern District of New York, case number 1:26-civ-08162. Rather than fight the charges, SQN Capital and Silkowski agreed to settle.
On October 8, the court entered consent judgments imposing permanent injunctive relief and appointing a receiver. The receiver will liquidate the assets of the four managed funds and distribute net proceeds to the investors who have been waiting on them.
The allegations against Jeremiah Silkowski
According to the complaint, from at least 2019 through 2025, Silkowski and SQN Capital repeatedly breached fiduciary duties to the four funds they managed. The alleged failures touch nearly every part of fund oversight.
The SEC says the funds’ governing documents required audited annual financial statements. Instead, no accounting firm was ever engaged. The only valuations ever prepared were done by Silkowski alone, even as investors were told an independent valuation expert was responsible.
The complaint adds that those net asset values stayed frozen for years, unmoved by changing cash flows, deteriorating markets, actual asset performance, or even whether a given asset was still held. Investors also received repeated claims that liquidation was nearly finished when the process had stalled and the firm lacked the resources to complete it.
A repeat offender the SEC charged twice before
The complaint describes SQN Capital as a recidivist. The commission twice charged the firm in settled administrative proceedings for violating the custody rule and the compliance rule, first in 2020 and again in 2023.
Both earlier actions stemmed from failures to deliver audited financial statements to fund investors. Silkowski was charged in the second proceeding with aiding and abetting those violations.
| Year | SEC action | Core allegation | Outcome |
|---|---|---|---|
| 2020 | Settled administrative proceeding | Custody rule and compliance rule | Firm cited over missing audits |
| 2023 | Settled administrative proceeding | Same rules, same failure | Silkowski cited for aiding and abetting |
| 2026 | Federal civil complaint, settled | Advisers Act antifraud provisions | Receiver, $200,000 penalty, associational bar |
What the settlement requires
Beyond the receivership, the judgments permanently enjoin SQN Capital and Silkowski from the charged violations. Silkowski must pay a $200,000 civil penalty.
He is also permanently prohibited from acting as, or associating with, an investment adviser, broker, or dealer. The only exception lets him assist the receiver if the receiver decides such help is necessary to do the court-ordered work.
Red flags fund investors should watch
The SQN Capital case shows how long a fund can look normal on paper while the substance decays. A few habits catch that early.
- Fund statements that arrive without an auditor’s name attached.
- Net asset values that sit at the same number quarter after quarter.
- Valuation claims you cannot confirm with an independent administrator.
- Liquidation deadlines that keep sliding while distributions stay frozen.
What SQN Capital investors can do now
The receiver now controls the funds’ assets and will run the claims process. Investors should watch for official receiver notices, keep subscription records and every statement, and confirm any distribution instructions through verified channels.
A securities attorney can help investors understand where they stand in a receivership queue and whether additional claims exist. The defendants settled without admitting the complaint’s allegations.
Haselkorn & Thibaut fights for investor recovery
Haselkorn & Thibaut is a securities law firm founded by former Wall Street defense attorneys who shifted their practice to represent investors. The firm has recovered over $520 million for clients in securities matters and maintains a 98 percent success rate in resolved nontraded REIT cases. Attorneys are AV Preeminent rated through Martindale-Hubbell, designated as Super Lawyers, and hold a 5.0-star client review average. The firm operates on a contingency basis — no recovery, no fee.
Contact Haselkorn & Thibaut today
Time matters in securities fraud cases. The earlier you act, the stronger your position. The firm offers a free case evaluation to assess your losses, review your account history, and explain your options under arbitration or settlement.
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