# UNITED STATES OF AMERICA

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URL: https://www.frixlaw.com/law-library/documents/agency%3Asec%3Ad1a07956cb839d89

## Record

- **Collection:** Agency decision
- **Document type:** Agency decision

## Text

UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
ADMINISTRATIVE PROCEEDING
File No. 3-22236
In the Matter of
Rimar Capital USA, Inc., Rimar
Capital, LLC, Itai Royi Liptz, and
Clifford Todd Boro
Respondents.
I.

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PROPOSED PLAN OF
DISTRIBUTION

OVERVIEW

1.
The Division of Enforcement submits this Proposed Plan of Distribution (the
“Plan”) to the United States Securities and Exchange Commission (the “Commission”) pursuant
to Rule 1101 of the Commission’s Rules on Fair Fund and Disgorgement Plans (the
“Commission’s Rules”), 17 C.F.R. § 201.1101. This Plan provides for the distribution of a Fair
Fund comprised of disgorgement, prejudgment interest, and civil money penalties paid by Rimar
Capital USA, Inc., Rimar Capital, LLC, Itai Royi Liptz, and Clifford Todd Boro (collectively,
the “Respondents”) in the above-captioned matter. 1
2.
As described more specifically below, the Plan seeks to compensate investors
who were harmed by the Respondents’ fraudulent conduct described in the Order related to an
offering of Simple Agreements for Future Equity (“SAFEs”) 2 in a holding company, Rimar
USA, controlled by Liptz, as well as false and misleading statements by and about stateregistered investment adviser, Rimar LLC, which Liptz also controlled. Based on information
obtained by the Commission staff during its investigation and the review and analysis of
applicable records, the Commission staff has reasonably concluded that it has all records
necessary to calculate each investor’s harm. As a result, the Fair Fund is not being distributed
according to a claims-made process, so procedures for making and approving claims in

See Order Instituting Administrative and Cease-and-Desist Proceedings, Pursuant to Section 8A of the Securities
Act of 1933, Section 21C of the Securities Exchange Act of 1934, Sections 203(e), 203(f) and 203(k) of the
Investment Advisers Act of 1940, and Section 9(b) of the Investment Company Act of 1940, Making Findings, and
Imposing Remedial Sanctions and a Cease-and-Desist Order, Securities Act Rel. No. 11316 (Oct. 10, 2024).
(the “Order”).
1

A SAFE is a securities agreement between an investor and the company in which the company generally promises
to give the investor a future equity stake in the company if certain trigger events occur.

2

accordance with Rule 1101(b)(4) of the Commission’s Rules, 17 C.F.R. § 201.1101(b)(4), are
not applicable.
3.
As calculated using the methodology detailed in the Plan of Allocation (attached
as Exhibit A), investors will be compensated for their out-of-pocket losses on SAFEs
(the “Security”) purchased between May 1, 2022, and April 30, 2023 (the “Relevant Period”).
4.
In the view of the Commission staff, this methodology constitutes a fair and
reasonable allocation of the Fair Fund.
5.
The Commission has custody of the Fair Fund and will retain control of the assets
of the Fair Fund. The Plan is subject to approval by the Commission, and the Commission
retains jurisdiction over its implementation.
II.

BACKGROUND

6.
On October 10, 2024, the Commission issued the Order instituting and
simultaneously settling administrative and cease-and-desist proceedings against the Respondents.
In the Order, the Commission found that Respondents engaged in fraudulent conduct related to
an offering of SAFEs in a holding company, Rimar USA, controlled by Liptz. The Commission
also found that Respondents made false and misleading statements about state-registered
investment adviser Rimar LLC, which Liptz also controlled. According to the Order, between
May 2022 and April 2023, Liptz, through Rimar USA, and with the help of Rimar USA board
member Boro, raised nearly $4 million from 45 investors for the development of Rimar LLC, an
adviser that purported to use artificial intelligence to perform automated trading for advisory
client accounts in a range of products including equities, futures, and crypto assets through a
series of misrepresentations about the platform’s features, its assets under management, its
performance, and its supposed artificial intelligence-powered application. According to the
Order, these same misrepresentations were also made to obtain advisory clients, many of whom
became clients after investing in the SAFEs. In addition, the Commission found that Liptz
improperly used some of the SAFE proceeds for personal purposes.
7.
As a result of this conduct, the Commission found that Rimar USA violated
Section 17(a) of the Securities Act of 1933 (“Securities Act”) and Section 10(b) of the Securities
Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder; Rimar LLC willfully
violated Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 (“Advisers Act”);
Liptz willfully violated Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act
and Rule 10-b thereunder, and Sections 206(1) and 206(2) of the Advisers Act; and Boro
violated Sections 17(a)(2) and 17(a)(3) of the Securities Act. The Commission ordered Liptz to
pay $202,604 in disgorgement and prejudgment interest of $11,007.25 for a total of $213,611.25,
with such payment being deemed satisfied by offsets recorded in July 2024 against capital
advances Liptz previously made to Rimar USA and Rimar LLC. The Commission further
ordered Liptz and Boro to pay a collective total of $310,000 in civil money penalties to the
Commission. The Commission also created a Fair Fund, pursuant to Section 308(a) of the
Sarbanes-Oxley Act of 2002, so the penalties collected can be distributed to harmed investors
(the “Fair Fund”).

2

8.
The Respondents have paid in full. The Fair Fund includes the $310,000 in civil
money penalties collected from Liptz and Boro. The Fair Fund has been deposited in a
Commission-designated account at the U.S. Department of the Treasury (the “Treasury”), and
any accrued interest will be added to the Fair Fund.
III.

DEFINITIONS
As used in this Plan, the following definitions will apply:

9.
“Administrative Costs” means any administrative costs and expenses, including
without limitation tax obligations, the fees and expenses of the Tax Administrator, and
investment and banking costs.
10.
“Certification Date” means the date established in accordance with this Plan by
which a Preliminary Claimant’s Certification Form must be postmarked or submitted
electronically in order to be eligible to participate in this distribution. The Certification Date will
be 90 days from the mailing of the Plan Notice.
11.
“Certification Form” means the form that must be completed and signed by each
Preliminary Claimant attesting to their name, mailing address, and sufficient information to
confirm their tax identification and status. By signing the Certification Form, the Preliminary
Claimant swears or affirms that all information provided is accurate and complete to the best of
their knowledge and that they are not an Excluded Party as defined in paragraph 15. The
Certification Form may be accompanied by tax forms, as required, relating to the tax treatment
of any distribution. All references to the Certification Form in this Plan incorporate by reference
any tax forms or other supporting documentation requested in the Plan Notice. If a Preliminary
Claimant fails to submit a Certification Form by the Certification Date, the Preliminary Claimant
may not be eligible to receive a Distribution Payment.
12.
“Determination Notice” means the notice sent within 120 days of the
Certification Date to any Preliminary Claimant whose Certification Form is deficient, in whole
or in part. The Determination Notice will provide the reason(s) for the deficiency and in the
event the Preliminary Claimant has been deemed an Excluded Party, the Determination Notice
will state the reason(s) for such. The Determination Notice will also notify the Preliminary
Claimant of the opportunity to cure any deficiency or request reconsideration of the
determination made by the Third Party and provide instructions regarding what is required to do
so.
13.
“Distribution Payment” means a payment from the Fair Fund to a Payee in
accordance with the terms of this Plan.
14.
“Eligible Claimant” means a Preliminary Claimant, who is determined to have
suffered a Recognized Loss, pursuant to the Plan of Allocation, and who is not an Excluded
Party or an Unresponsive Preliminary Claimant.
15.
“Excluded Party” means (a) the Respondents; (b) any present or former officers
or directors of the Respondents or any assigns, creditors, heirs, distributees, spouses, parents,
dependent children or controlled entities of any of the foregoing Persons or entities; (c) any
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employee or former employee of the Respondents or any of their affiliates who have been
terminated for cause or has otherwise resigned, in connection with the conduct described in the
Order; (d) any Person who, as of the Certification Date, has been the subject of criminal charges
related to the conduct described in the Order or any related Commission action; (e) the Third
Party retained to assist the Fund Administrator or their employees; and (f) any purchaser or
assignee of another Person’s right to obtain a recovery from the Fair Fund for value; provided,
however, that this provision will not be construed to exclude those Persons who obtained such a
right by gift, inheritance or devise.
16.
“Fair Fund” means the fund created by the Commission pursuant to Section
308(a) of the Sarbanes-Oxley Act of 2002, for the benefit of investors harmed by Respondents’
violations described in the Order.
17.
“Final Determination Notice” means the written notice sent to notify each
Preliminary Claimant that they have been determined to be either (a) an Eligible Claimant and
confirm their calculated amount of Recognized Loss; or (b) an Unresponsive Preliminary
Claimant or an Excluded Party and are not eligible for a distribution. A Final Determination
Notice will not be sent to a Preliminary Claimant if their Plan Notice was returned as
“undeliverable.” The Final Determination Notice will constitute the Third Party’s final ruling
regarding the eligibility status and loss calculation and is not subject to appeal.
18.
“Net Available Fair Fund” means the Fair Fund, plus any interest or earnings,
less Administrative Costs.
19.
“Payee” means an Eligible Claimant whose distribution amount calculates, in
accordance with the Plan of Allocation, to a distribution amount equal to or greater than $20,
who will receive a Distribution Payment.
20.
“Person” means natural individuals as well as legal entities such as corporations,
partnerships, or limited liability companies.
21.
“Plan Notice” means the written notice sent to each Preliminary Claimant
regarding the Commission’s approval of the Plan, including, as appropriate: a statement
characterizing the distribution; a link to the approved Plan posted on the Commission’s website
and instructions for requesting a copy of the Plan; the Certification Form, along with
specification of any information needed from the Preliminary Claimant to prevent them from
being deemed an Unresponsive Preliminary Claimant; their calculated Recognized Loss; a
description of the tax information reporting and other related tax matters; the procedure for the
distribution as set forth in the Plan; and the name and contact information for the Third Party as a
resource for additional information or to contact with questions regarding the distribution.
22.
“Plan of Allocation” means the methodology used by the Third Party to calculate
if a Preliminary Claimant has suffered a Recognized Loss. The Plan of Allocation is attached as
Exhibit A.
23.
“Preliminary Claimant” means a Person, or their lawful successors, identified
by the Fund Administrator based on their review and analysis of applicable records obtained by
the Commission staff during and/or after its investigation, who may have suffered a loss as a
4

result of transactions in the Security during the Relevant Period; or those Persons who request a
Plan Notice, as described in paragraph 40, who are determined by the Fund Administrator to
have suffered a loss as a result of transactions in the Security during the Relevant Period.
24.
“Recognized Loss” means the amount of loss calculated in accordance with the
Plan of Allocation.
25.

“Relevant Period” is between May 1, 2022, and April 30, 2023.

26.

“Security” means Simple Agreements for Future Equity (“SAFEs”).

27.
“Unresponsive Preliminary Claimant” means (a) a Preliminary Claimant whose
address the Third Party is unable to verify by the Certification Date; or (b) a Preliminary
Claimant who does not timely return the Certification Form and any other information or
documentation requested in the Plan Notice, or as specified in their Determination Notice.
Unresponsive Preliminary Claimants will not be eligible for a Distribution Payment.
IV.

TAX COMPLIANCE

28.
On March 13, 2025, the Commission appointed Heffler, Radetich & Saitta, LLP
as the tax administrator (the “Tax Administrator”) for the Fair Fund to handle the tax obligations
of the Fair Fund. 3 The Tax Administrator will be compensated for reasonable fees and expenses
from the Fair Fund in accordance with their 2026 Engagement Letter Agreement with the
Commission.4
29.
The Fair Fund constitutes a Qualified Settlement Fund (“QSF”) under Section
468B(g) of the Internal Revenue Code of 1986, as amended, 26 U.S.C. § 468B(g), and related
regulations, 26 C.F.R. §§ 1.468B-1 through 1.468B-5. The Tax Administrator is the
administrator of such QSF for purposes of Treas. Reg. § 1.468B-2(k)(3)(I) and will satisfy the
tax-related administrative requirements imposed by Treas. Reg. § 1.468B-2, including, but not
limited to:

3

(a)

Obtaining a taxpayer identification number;

(b)

Requesting funds necessary for the timely payment of all applicable taxes,
the payment of taxes for which the Tax Administrator has received funds,
and the filing of applicable returns; and

(c)

Fulfilling any information reporting or withholding requirements imposed
on distributions from the Fair Fund, including but not limited to Foreign
Account Tax Compliance Act (FATCA).

See Order Appointing Tax Administrator, Exchange Act Rel. No. Exchange Act Rel. No. 102667 (Mar. 13, 2025).

See Omnibus Order Directing the Engagement of Two Tax Administrators for Appointment on a Case-By-Case
Basis in Administrative Proceedings that Establish Distribution Funds, Exchange Act Rel. No. 104544
(Jan. 5, 2026).

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30.
All tax obligations will be paid from the Fair Fund, subject to the review and
approval of Commission staff.
V.

FUND ADMINISTRATOR

31.
Allison J.P. Moon is proposed to be the fund administrator for the Fair Fund
(the “Fund Administrator”). As a Commission employee, the Fund Administrator will receive
no compensation other than her regular salary as a Commission employee for her services in
administering the Fair Fund. In accordance with Rule 1105(c) of the Commission’s Rules,5 no
bond is required since the Fund Administrator is a Commission employee. The Fund
Administrator will be responsible for administering the Fair Fund in accordance with the Plan.
The Fund Administrator will engage a third party (the “Third Party”) to perform some of the
administrative tasks associated with implementing the Plan. The Third Party’s fees and expenses
will be paid from the Fair Fund as an Administrative Cost, pursuant to a cost proposal submitted
to and approved by the Commission staff.
32.
To carry out the purposes of this Plan, the Fund Administrator is authorized to
make and implement immaterial changes to the Plan upon agreement of the Commission staff. If
a change is deemed to be material by the Commission staff, Commission approval is required
prior to implementation by amending the Plan.
33.
The Fund Administrator may extend any procedural deadline contained in the
Plan for good cause shown, if agreed upon by the Commission staff.
VI.

PLAN PROCEDURES
Specification of Preliminary Claimants

34.
Using information obtained during and/or after its investigation, the Commission
staff has identified the Preliminary Claimants. Preliminary Claimants are limited to only those
Persons who may have suffered a loss as a result of transactions in the Security during the
Relevant Period.
Distribution Methodology
35.
The Fund Administrator will calculate each Preliminary Claimant’s Recognized
Loss in accordance with the Plan of Allocation. All Preliminary Claimants who are determined
to have a Recognized Loss and who are not deemed an Excluded Party or an Unresponsive
Preliminary Claimant will be deemed Eligible Claimants.
36.
No Distribution Payments will be made for less than $20. If an Eligible
Claimant’s distribution amount, in accordance with the Plan of Allocation, calculates to a
distribution amount less than $20, that Eligible Claimant will be deemed ineligible to receive a
Distribution Payment, and their distribution amount will be reallocated pro rata to Eligible
Claimants whose distribution amounts are greater than or equal to $20. All Eligible Claimants
5

17 C.F.R. § 201.1105(c).

6

whose Recognized Loss calculates to a distribution amount equal to or greater than $20 will be
deemed a Payee and will receive a Distribution Payment.
Procedures for Locating and Notifying Preliminary Claimants
37.
Within 120 days of Commission approval of the Plan, the Third Party will send
the Plan Notice and Certification Form to each Preliminary Claimant’s last known email address
(if known) and/or mailing address.
Undeliverable Mail
38.
The Third Party will attempt to locate any Preliminary Claimant whose mailing is
returned as “undeliverable” and will document all such efforts. The Third Party will use its best
efforts to make use of commercially available resources and other reasonably appropriate means
to obtain updated addresses in response to “undeliverable” notices and forward any returned mail
for which an updated address is provided or obtained. The Third Party will make available, upon
request by the Commission staff, a list of all Preliminary Claimants whose Plan Notice has been
returned as “undeliverable” due to incorrect addresses and for which the Third Party has been
unable to locate current addresses. If the mailing is returned again and the Third Party, despite
best practicable efforts, is unable to find a Preliminary Claimant’s correct address, the Third
Party, in its discretion, may deem such Preliminary Claimant an Unresponsive Preliminary
Claimant.
39.
Any Preliminary Claimant who relocates or otherwise changes contact
information after receipt of the Plan Notice must promptly communicate any change in address
or contact information to the Third Party.
Procedures to Request Plan Notice
40.
Any Person who does not receive a Plan Notice and Certification Form, but who
is aware of this Plan (e.g., through other Preliminary Claimants or on www.sec.gov) and believes
they should be included as a Preliminary Claimant should contact the Third Party within 90 days
from the approval of the Plan to establish that they should be considered a Preliminary Claimant.
Such Person should include with that communication, documentation sufficient to support their
assertion that they should be considered a Preliminary Claimant, as well as contact information
(physical address, telephone number, and email address, if available) for responsive
communications. The Third Party will send the Person a Plan Notice and Certification Form
within 30 days of receiving the Person’s documentation, if the Third Party determines that the
Person should be classified as a Preliminary Claimant.
Certification Requirement and Failure to Respond to Plan Notice
41.
To maintain classification as a Preliminary Claimant, a completed Certification
Form with all supporting documentation as requested in the Plan Notice must be signed by the
Preliminary Claimant and returned to the Third Party by the Certification Date. The
Certification Form must be executed by the Preliminary Claimant, unless the Third Party accepts
such Certification Form from a successor, heir, administrator, or other Person authorized to act
on the Preliminary Claimant’s behalf. Those authorized to act on behalf of a Preliminary
7

Claimant will be eligible to participate in the distribution to the same extent the original investor
would have been eligible under the terms of the Plan.
42.
The Third Party will review all Certification Forms. Each Preliminary Claimant
has the burden of proof to establish their identity as a Preliminary Claimant or their successor.
The Third Party may request, and the Preliminary Claimant has the burden of providing any
additional information and/or documentation deemed relevant by the Third Party.
43.
If a Preliminary Claimant fails to return the Certification Form or any requested
supporting documentation by the Certification Date, the Third Party will make no fewer than two
attempts to contact the Preliminary Claimant by mail, telephone or email, if known. The last
attempt will be made no later than 30 days from the Certification Date.
Dispute Process
44.
Disputes will be limited to calculation of Recognized Loss. If a Preliminary
Claimant disagrees with the Recognized Loss provided in the Plan Notice, such dispute must be
detailed on the Certification Form and returned to the Third Party along with any supporting
documentation by the Certification Date. The Third Party will investigate the dispute, and such
investigation will include a review of the written dispute as well as any supporting
documentation.
Review of Certification Forms and Deficiency Process
45.
The Third Party will provide a Determination Notice within 60 days of the
Certification Date to any Preliminary Claimant whose Certification Form is deficient, in whole
or in part. The Determination Notice will provide the reason(s) for the deficiency and in the
event the Preliminary Claimant is determined to be an Excluded Party, the Determination Notice
will state the reason(s) for such. The Determination Notice will also notify the Preliminary
Claimant of the opportunity to cure any deficiency or request reconsideration of the
determination made by the Third Party and provide instructions regarding what is required to do
so.
46.
Any Preliminary Claimant with a deficient Certification Form or missing required
documentation will have 30 days from the date of the Determination Notice to cure any
deficiencies identified in the Determination Notice.
47.
Any Preliminary Claimant seeking reconsideration of the Third Party’s
determination made in the Determination Notice will have 30 days from the date of the
Determination Notice to submit their request to the Third Party in writing. All requests for
reconsideration must include the necessary documentation to substantiate the basis upon which
the Preliminary Claimant is requesting reconsideration of the Third Party’s determination.
48.
The Third Party, in consultation with the Fund Administrator, has the authority to
waive technical deficiencies in the Certification Form.

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Final Determination Notices
49.
The Third Party will make its final eligibility determination only after reviewing
timely responses received to the Determination Notices and investigating any disputes indicated
on the Certification Forms regarding the Recognized Losses provided in the Plan Notices.
50.
Within 60 days of the Certification Date, the Third Party will send a Final
Determination Notice to notify each Preliminary Claimant of their final eligibility determination.
The Final Determination Notice will notify each Preliminary Claimant that they have been
determined to be either (a) an Eligible Claimant and confirm their calculated Recognized Loss;
or (b) an Unresponsive Preliminary Claimant or an Excluded Party and are not eligible to receive
a Distribution Payment. A Final Determination Notice will not be sent to a Preliminary Claimant
if their Plan Notice was returned as “undeliverable.” The Final Determination Notice will
constitute the Third Party’s final ruling regarding the eligibility status and loss calculation and is
not subject to appeal.
Establishment of a Reserve
51.
Before determining the amount of funds available for distribution and calculating
each Payee’s Distribution Payment, the Third Party, in conjunction with the Tax Administrator,
will establish a reserve to pay Administrative Costs and to accommodate any unexpected
expenditures (the “Reserve”).
52.
After all Distribution Payments are made and Administrative Costs are paid, any
remaining amounts in the Reserve will become part of the Residual described in paragraph 68.
Preparation of the Payment File
53.
Within 60 days of the Final Determination Notices, the Third Party will compile
and send to the Commission staff the Payee information, including the name, address, calculated
Recognized Loss, and the amount of the Distribution Payment for all Payees (the “Payee List”).
The Escrow Account
54.
Prior to the disbursement of funds from the Net Available Fair Fund, the Third
Party will establish an escrow account at a United States commercial bank that is a wellcapitalized financial institution as defined by the Federal Reserve Act, Subpart D, 12 C.F.R.
§ 208.43 and that is not unacceptable to the Commission staff (the “Bank”), pursuant to an
escrow agreement (the “Escrow Agreement”) provided by the Commission staff.
Distribution of the Fair Fund
55. Pursuant to Rule 1101(b)(6) of the Commission’s Rules, 17 C.F.R. §
201.1101(b)(6), the Commission staff will obtain an order from the Commission to disburse
funds from the Net Available Fair Fund to the Bank in accordance with the Payee List for
distribution by the Third Party in accordance with the Plan.

9

56. The Third Party will be responsible for issuing Distribution Payments to Payees in
accordance with the Payee List. For any electronic payment, the exact amount necessary to
make a payment will be transferred directly to the Payee’s bank account in accordance with
written instructions provided to the Bank by the Third Party.
57.
All checks will bear a stale date of 180 days from the date of issuance.
Reissuance of a check must be requested before the stale date, and such request is governed by
paragraph 62.
58.
All Distribution Payments will be preceded or accompanied by a communication
that includes, as appropriate: (a) a statement characterizing the distribution; (b) a statement that
the tax treatment of the distribution is the responsibility of each Payee and that the Payee should
consult their tax advisor for advice regarding the tax treatment of the distribution; however, any
backup withholding required under IRC § 3406(a) and the regulations promulgated thereunder,
or withholding required with respect to nonresident aliens (“NRAs”) under Chapter 3 of the IRC,
or FATCA-subject Payees under Chapter 4 of the IRC, will be withheld as required from the
Distribution Payment and remitted to the Internal Revenue Service on the Payee’s behalf; (c) a
statement that checks will be void and cannot be reissued after 180 days from the date the
original check was issued; and (d) contact information for the Third Party for questions regarding
the Distribution Payment. The letter or other mailings to Payees characterizing a Distribution
Payment will be prepared by the Tax Administrator and provided to the Commission staff for
review and approval.
59.
All Distribution Payments, either on their face or in the accompanying mailing,
will clearly indicate that the money is being distributed from the Fair Fund established by the
Commission to compensate investors for harm as a result of securities law violations.
60.
Bank fees charged by the intermediary or designation bank selected by the Payee
may reduce a Payee’s Distribution Payment.
Post Distribution; Handing of Returned or Uncashed Checks; and Reissues
61.
The Third Party will use their best efforts to make use of commercially available
resources and other reasonably appropriate means to locate all Payees whose checks are returned
to the Third Party as “undeliverable.” If new address information becomes available, the Third
Party will repackage the distribution check and send it to the new address. If, within 180 days of
the initial mailing of the distribution check, new address information is not available after a
diligent search or if the distribution check is returned again, the Third Party will void the
distribution check, and at the discretion of the Fund Administrator the Payee may be removed
from the distribution and the allocated Distribution Payment will remain in the Fair Fund for
distribution, if feasible, to the remaining Payees.
62.
The Third Party, at the direction of the Fund Administrator, will reissue
distribution checks to Payees upon the receipt of a valid, written request from the Payee prior to
the initial stale date. In cases where a Payee is unable to endorse a distribution check as written
(e.g., name changes, IRA custodian changes, or recipient is deceased) and the Payee or a lawful
representative requests the reissuance of a distribution check in a different name, the Third Party
10

will request, and must receive, documentation to support the requested change. The Third Party,
in consultant with the Fund Administrator, will review the documentation to determine the
authenticity and sufficiency of the change request. If, in the discretion of the Fund
Administrator, such change request is sufficiently documented, the Third Party, at the direction
of the Fund Administrator, will issue an appropriately redrawn distribution check to the
requesting party. Reissued checks will be void 180 days from the reissuance, and in no event
will a check be reissued after 180 days from the date of the original issuance without the
approval of the Fund Administrator.
63.
The Third Party will work with the Bank and maintain information about
uncashed checks and any returned items due to non-delivery, insufficient addresses, and/or other
deficiencies. The Third Party is responsible for researching and reconciling errors and reissuing
payments when possible. The Third Party is also responsible for accounting for all payments.
The amount of all uncashed and undelivered payments will continue to be held in the Fair Fund.
64.
The Third Party will make and document their best efforts to contact Payees to
follow-up on the status of uncashed distribution checks over $100 (other than those returned as
“undeliverable”) and take appropriate action to follow up on the status of uncashed checks at the
request of the Fund Administrator. The Third Party may reissue such checks, subject to the time
limits detailed herein. If a distribution check remains uncashed after the stale date, the Third
Party will instruct the Bank to issue a stop payment on the distribution check. The Third Party,
in its discretion, may remove such Payee from the distribution, and the allocated Distribution
Payment will remain in the Fair Fund for distribution, if feasible, to the remaining Payees.
Administrative Costs
65.
All Administrative Costs will be paid from the Fair Fund in accordance with this
Plan and the Commission’s Rules. Upon completion of the final distribution, the Fund
Administrator will arrange for the final payment of all Administrative Costs.
Receipt of Additional Funds
66.
Should any additional funds be received pursuant to Commission or Court order,
agreement, or otherwise prior to the Commission’s termination of the Fair Fund, such funds will
be added to the Fair Fund and distributed, if feasible, in accordance with the Plan and pursuant to
the Commission’s Rules.
Disposition of Undistributed Funds
67.
If funds remain following the initial distribution, the Fund Administrator may
seek subsequent distribution(s) of any available remaining funds in accordance with the Plan and
pursuant to the Commission’s Rules.
68.
A residual within the Fair Fund will be established for any amounts remaining
after the final disbursement to Payees from the Fair Fund and payment of all Administrative
Costs (the “Residual”). The Residual may include funds from, among other things, amounts
remaining in the Reserve, distribution checks that have not been cashed, checks or electronic
11

payments that were not delivered or were returned to the Commission, and tax refunds due to the
Fair Fund’s overpayment of taxes or for waiver of IRS penalties.
69.
Within 90 days of the stale date of the distribution payments, the Fund
Administrator, in consultation with the Third Party, will determine whether further distribution
of the Fair Fund to investors is feasible. Within 45 days of the determination that further
distribution is infeasible, the Third Party will return any funds remaining in the Escrow Account
to the Commission to become part of the Residual.
70.
All funds remaining in the Residual that are infeasible to distribute to investors
will be returned to the Commission and transferred to the Treasury, subject to Section 21F(g)(3)
of the Securities Exchange Act of 1934 (the “Exchange Act”), after the final accounting is
approved by the Commission. Returning such money to the Respondents would be inconsistent
with the equitable principle that no Person should profit from their wrongdoing. Therefore, in
these circumstances, distributing disgorged funds to the Treasury is the most equitable
alternative.
Accounting
71.
When all funds have been disbursed, except for the Residual described in
paragraph 68 of the Plan, the Third Party will submit to the Fund Administrator a final report
(the “Third Party Final Report”) that includes an accounting of all funds disbursed to the Bank.
The Third-Party Final Report will include, at a minimum, the number and total amount of
Distribution Payments sent to Payees, and the number and total amount of Distribution Payments
successfully disbursed (i.e., cashed or electronically transferred) to Payees, and the amount of
funds returned to the Commission, pursuant to paragraph 69. The Third-Party Final Report must
be endorsed by a declaration executed by the Third Party under penalty of perjury under the laws
of the United States.
72.
Upon receipt of the Third Party’s Final Report described above, the Fund
Administrator will submit a final accounting pursuant to Rule 1105(f) of the Commission’s
Rules, 17 C.F.R. § 201.1105(f), for the Commission’s approval prior to termination of the Fair
Fund and discharge of the Fund Administrator. Since the Fund Administrator is a Commission
employee, no interim accountings will be made.
Wind-down and Document Retention
73.
The Third Party will shut down the website, P.O. Box and customer service
telephone line(s) established specifically for the administration of the Fair Fund upon the transfer
of any remaining funds to the Commission, as described in paragraph 69.
74.
The Third Party will retain all materials submitted by Preliminary Claimants in
either paper or electronic form for a period of 6 years from the date of approval of a final fund
accounting. Materials maintained in electronic form must be accessible and readable for the
duration of retention. Pursuant to the Commission staff’s direction, the Third Party will either
turn over to the Commission or destroy all materials, including documents in any media, upon
expiration of this period.
12

Termination of the Fair Fund
75.
The Fair Fund will be eligible for termination and the Fund Administrator will be
eligible for discharge after all of the following have occurred (a) a final accounting, in a standard
accounting format provided by the Commission staff, has been submitted by the Fund
Administrator and approved by the Commission; (b) all Administrative Costs have been paid;
and (c) any amount remaining in the Fair Fund has been returned to the Commission for transfer
to Treasury. Once the Commission has approved the final accounting, the Commission staff will
seek an order from the Commission authorizing: (a) the transfer of the Residual that is infeasible
to return to investors, and any amounts returned to the Fair Fund in the future that is infeasible to
return to investors, to the general fund of the Treasury, subject to Section 21F(g)(3) of the
Exchange Act; (b) discharge of the Fund Administrator; and (c) termination of the Fair Fund.
VII.

Notice of Proposed Plan and Opportunity for Comment

76.
The Notice of the Proposed Plan of Distribution and Opportunity for Comment
(the “Plan Notice”) will be published on the Commission’s website
https://www.sec.gov/litigation/fairfundlist.htm. Any Person wishing to comment on the Plan
must do so in writing by submitting their comments within 30 days of the date of the Notice (a)
to the Office of the Secretary, United States Securities and Exchange Commission, 100 F Street,
N.E., Washington, D.C. 20549-1090; (b) by using the Commission’s Internet comment form
(https://www.sec.gov/litigation/admin.shtml); or (c) by sending an e-mail to
rule-comments@sec.gov. Comments submitted by e-mail or via the Commission’s website
should include “Administrative Proceeding File No. 3-22236 in the subject line. Comments
received will be publicly available. Persons should only submit comments that they wish to
make publicly available.

13

Exhibit A
PLAN OF ALLOCATION
This Plan of Allocation 1 is designed to compensate investors based on their out-of-pocket
losses on Simple Agreements for Future Equity of Rimar USA (“SAFEs” or the “Security”)
purchased between May 1, 2022, and April 30, 2023 (the “Relevant Period”). Investors who did
not invest in the Security during the Relevant Period are ineligible to recover under this Plan.
Based upon records obtained by the Commission during and/or after its investigation, the
Fund Administrator has identified those investors, or their lawful successors, who may have
suffered an out-of-pocket loss from investing in the Security after relying on Respondents’
misrepresentations about the Rimar LLC platform’s features, AI-related capabilities,
profitability, and assets under management (“Preliminary Claimants”).
I.

Methodology

The Fund Administrator will calculate each Preliminary Claimant’s loss (“Recognized
Loss”) as the principal invested in the Security, minus any proceeds received from selling the
Security. 2 If the Recognized Loss calculates to a negative number, reflecting a gain, then the
Recognized Loss will be $0.
Any Preliminary Claimant who suffered a Recognized Loss pursuant to this Plan of
Allocation, and who is not an Excluded Party or an Unresponsive Preliminary Claimant, will be
deemed an Eligible Claimant.
II.

Allocation of Funds

Because the Net Available Fair Fund is less than the sum of the Recognized Losses of all
Eligible Claimants, each Eligible Claimant’s distribution amount will equal his, her, or its
“Pro-Rata Percentage” of the Net Available Fair Fund. The distribution amount will be subject
to the “Offset for Prior Recovery” and “Minimum Distribution Amount.”
A.

Calculating an Eligible Claimant’s Pro-Rata Percentage

This computation is intended to measure Eligible Claimants’ Recognized Losses against
one another. The Fund Administrator shall determine each Eligible Claimant’s Pro-Rata
Percentage as the ratio of his, her, or its Recognized Loss to the sum of Recognized Losses of all
Eligible Claimants.
B.

Offset for Prior Recovery

To avoid payment of a windfall, an Eligible Claimant’s distribution amount will be no
larger than his, her, or its Recognized Loss minus the amount of any compensation for the loss
that resulted from the conduct described in the Order that was received from another source (e.g.,
1

All capitalized terms used herein but not defined have the same meanings ascribed to them in the Plan.

2

For purposes of calculating Recognized Loss, the Security is deemed to have a held value of $0.

class action settlement), to the extent known by the Fund Administrator (“Prior Recovery”).
That is, the distribution amount will be capped at the Recognized Loss less the Prior Recovery.
C.

Minimum Distribution Amount

The Minimum Distribution Amount will be $20. An Eligible Claimant whose
distribution amount is less than the Minimum Distribution Amount will be deemed ineligible and
his, her, or its distribution amount will be reallocated pro rata to Eligible Claimants whose
distribution amounts are greater than or equal to the Minimum Distribution Amount.
D.

Becoming Payee and Distribution Payment

An Eligible Claimant whose distribution amount equals or exceeds the Minimum
Distribution Amount will be deemed a Payee and will receive a Distribution Payment equal to
his, her, or its calculated distribution amount. In no event will a Payee receive from the Fair
Fund more than his, her, or its Recognized Loss.

2

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/agency%3Asec%3Ad1a07956cb839d89. Public record. Not legal advice.