(Bloomberg) -- Crypto investment firm Galois Capital Management will pay a $225,000 fine over Securities and Exchange Commission allegations that it broke rules for safeguarding client assets, including holding some of them in accounts with now bankrupt exchange FTX.

The SEC said Tuesday that in addition to breaking custody rules, Galois misled investors about how much notice they needed to give to redeem funds. The firm was a former investment adviser for a private fund that mostly invested in crypto assets. About half of the fund’s assets under management in early to mid-November 2022 were lost when FTX collapsed, the agency said.

Galois Capital didn’t admit to or deny SEC’s findings, but it agreed to cease and desist from further violations, according to a statement from the agency.

“After an exhaustive and costly investigation of nearly two years, and without admitting or denying the findings detailed in the SEC’s order, we agreed to settle with the SEC and pay a $225,000 penalty which will go directly to our investors,” Galois Capital wrote in a social-media post.

Galois was just one of the investors affected by the collapse of Sam Bankman-Fried’s FTX in 2022. Earlier that same year, Galois predicted and profited from the $60 billion collapse of the TerraUSD and Luna crypto ecosystem. That implosion contributed to the bankruptcies of hedge fund Three Arrows Capital, lender Celsius Network and broker Voyager Digital, among others.

--With assistance from Lydia Beyoud.