Welcome to the Chatham Fair Fund website

If you paid excess performance and management fees to Chatham from January 2016, through December 2018, inclusive (the “Relevant Period”) and you would like to be considered for eligibility to share in the Fair Fund distribution, you must complete and submit a Certification Form on or before 11:59 p.m. Eastern Standard Time on August 7, 2025 (the “Certification Form Deadline”). You can also submit a Certification Form by mail, in which case the completed Certification Form must be postmarked (or if not sent by U.S. Mail, received) by the Certification Form Deadline.

BACKGROUND

On April 3, 2023, the SEC instituted and simultaneously settled administrative and cease-and-desist proceedings (the “Order”) against Chatham Asset Management, LLC and Anthony Melchiorre (collectively, the “Respondents”). In the Order, the SEC found that Chatham and Melchiorre traded on behalf of their fund clients in three high-yield debt securities issued by American Media Inc. (“AMI”), a wholly owned subsidiary of AMI Parent Holdings, LLC (“AMI Parent”). At times, from 2016 through 2018, Chatham and Melchiorre engaged in transactions in these AMI debt securities (the “AMI Bonds”) that resulted in one Chatham fund selling AMI Bonds and a different Chatham fund purchasing the same AMI Bonds, through various broker-dealers (the “Rebalancing Trades”). Chatham engaged in the Rebalancing Trades to address portfolio constraints such as industry or issuer fund concentration limits, to meet investor redemptions, and to allocate capital inflows and outflows. These trades were executed at prices Chatham and Melchiorre proposed.

Over time, the prices at which Chatham and Melchiorre traded the securities in the Rebalancing Trades increased at a significantly higher rate than the prices of similar securities. Chatham’s and Melchiorre’s trading in the AMI Bonds accounted for the vast majority of the trading in those Bonds and therefore over time had a material effect on their pricing.

Chatham and Melchiorre calculated the net asset values (“NAVs”) of their client funds’ holdings using pricing data that was based, in part, on the trading prices of the securities. As a result, during the relevant period, the NAVs of Chatham’s Clients were higher than they would have been if Chatham’s Rebalancing Trades were removed from the market for the AMI Bonds, which, in turn, resulted in higher fees being charged to the clients than would have been charged if Chatham’s Rebalancing Trades were removed from the market.

Finally, the SEC found that many of the Rebalancing Trades involved open-ended mutual funds regulated as registered investment companies (“RICs”). The SEC found that, in those cases, Chatham and Melchiorre aided and abetted and caused RICs to enter into prohibited affiliate transactions in violation of Sections 17(a)(1) and (2) of the Investment Company Act.

The SEC ordered the Respondents to pay $11,000,000.00 in disgorgement, $3,375,072.00 in prejudgment interest, and $5,000,000.00 in civil money penalties, for a total of $19,375,072.00, to the SEC. The SEC also created a Fair Fund, pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, so the penalties, the disgorgement and interest collected (the “Fair Fund”), could be distributed to harmed investors.

The Chatham Fair Fund consists of the $19,375,072.00 paid by the Respondents. The Fair Fund has been deposited in a SEC-designated account at the U.S. Department of the Treasury, and any accrued interest will be added to the Fair Fund.

On April 3, 2024, the SEC issued an order appointing Heffler, Radetich & Saitta, LLP, as the Tax Administrator of the Fair Fund. On May 9, 2025, the SEC issued an order appointing Simpluris Inc. (“Simpluris”), as the Third-Party to oversee the administration and distribution of the Fair Fund.

On March 13, 2025, the SEC published a notice of the proposed plan of distribution and opportunity for comment and simultaneously published the proposed plan of distribution (“Proposed Plan”); and on May 9, 2025, the SEC approved the Plan of Distribution, which, among other things, appointed SEC employee Allison J.P. Moon as the Fund Administrator and authorized the Fund Administrator to engage Simpluris Inc. (“Simpluris”), as the Third-Party to perform administrative tasks associated with implementing the Plan.