The SEC settled charges against a private fund manager, its relying adviser, and sole owner for misallocating expenses to two private funds that were not authorized in fund governing documents and failing to disclose the resulting conflict of interest. Improper expenses included outsourced financial services, public relations services, and legal fees of the manager. The fund managers either had the private funds pay these expenses directly from fund bank accounts or paid the expenses themselves and then invoiced the private funds for reimbursement. The SEC further faulted the firm for its poor expense practices that contributed to the fund overpayment. This included approving expenses on behalf of the funds with generic descriptions and inadequate detail, charging personal travel expenses to a corporate credit card, inadequate procedures to match travel expenses to legitimate fund expenses, and failing to take reasonable steps to ensure fund expenses were consistent with governing documents.