A portfolio manager’s professional activities often include travel, gifts and entertainment expenses, but woe betide the manager who passes off personal expenses as business expenses. The SEC recently won a civil action against a former senior partner at Apollo Management, L.P. (Apollo) for falsely and repeatedly claiming personal expenses as business expenses, which were then billed to the funds he advised. Although the partner’s actions were unusually egregious in nature, the Findings of Fact and Conclusions of Law issued by the U.S. District Court for the Southern District of New York (Court) pointed out that Apollo’s policies and procedures deserved “significant blame” for the fraud. Less than two weeks after final judgment was entered against the partner, the SEC instituted public administrative proceedings against him. This article analyzes the judgment against the partner, including the deficiencies in Apollo’s policies and procedures that the Court identified as contributing to the misallocation to and payment by funds of the partner’s personal expenses. The article also contains key takeaways based on several Private Equity Law Report interviews about the matter, including the case’s significance and six important steps firms can take to avoid similar expense allocation violations in the future. See “Study Shows PE Managers Are Absorbing a Greater Portion of Expenses (Part One of Two)” (Mar. 19, 2019).