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To: Spirit of America Investment Fund, Inc - Board of Directors
From: Stephanie A. Djinis, Esq.
Date: November 20, 2003
Re: Financial Officer Code of Ethics
The Sarbanes-Oxley Act of 2002 was designed to address corporate malfeasance and
assure investors that the companies in which they invest are accurately and
completely disclosing financial information. Under the Act, all public
companies, including the Spirit of America Investment Fund, Inc. (the "Fund"),
must: (i) establish and approve a code of ethics for their senior financial
officers ("SFO") (which include the principal executive officer, the principal
financial officer, or principal accounting officer, and any person who performs
a similar function); or (ii) disclose why it does not have such a code.
The Act was intended to prevent future Enrons, situations where a company
creates an environment in which employees are afraid to express their opinions
or to question unethical and potentially illegal business practices. The Fund
has chosen to adopt a financial officer code of ethics to encourage its SFOs to
act ethically and to question potentially unethical or illegal practices.
The purposes of this Code include: (i) promoting honest and ethical conduct
among the Fund's SFOs, including the ethical handling of actual or apparent
conflicts of interest between personal and professional relationships; (ii)
assisting the Fund's SFOs in recognizing and avoiding conflicts of interest;
(iii) promoting full, fair, accurate and timely disclosure with respect to Fund
filings with SEC and other public communications; and (iv) complying with
applicable laws, rules and regulations.
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Exhibit 99.Code Ethics
SPIRIT OF AMERICA INVESTMENT FUND, INC.
FINANCIAL OFFICER CODE OF ETHICS
PURPOSES OF THE CODE
The reputation and integrity of the Spirit of America Investment Fund, Inc. (the
"Fund") are valuable assets that are vital to the Fund's success. Each officer
and employee of the Fund, including each of the Fund's senior financial officers
("SFOs"), is responsible for conducting the Fund's business in a manner that
demonstrates a commitment to the highest standards of integrity. SFOs include
the principal executive officer, the principal financial officer, principal
accounting officer, and any person who performs a similar function.
The Fund has adopted a Code of Ethics under Rule 17j-1 under the Investment
Company Act of 1940. The Fund's Rule 17j-1 Code is designed to prevent certain
conflicts of interest that may arise when officers, employees, or directors know
about present or future Fund transactions, have the power to influence those
transactions; and engage in securities transactions in their personal
account(s).
The Fund has chosen to adopt a financial officer code of ethics to encourage its
SFOs to act ethically and to question potentially unethical or illegal
practices, and to strive to ensure that the Fund's financial disclosures are
complete, accurate, and understandable. This Code of Ethics should be read in
conjunction with the Fund's other policy statements, including its Rule 17j-1
Code and its Disclosure Controls and Procedures.
PRINCIPLES FOR HANDLING OF FINANCIAL INFORMATION
The Fund has adopted the following principles to govern the manner in which SFOs
perform their duties. Persons subject to these guidelines include the principal
executive officer, the principal financial officer, principal accounting
officer, and any Fund officer or employee who performs a similar function or who
participates in the preparation of any part of the Fund's financial statements.
Specifically, persons subject to this Code shall:
- Act with honesty and integrity
- Avoid actual or apparent conflicts of interest with the Fund in
personal and professional relationships
- Provide information to the Fund's employees and service providers
(adviser, administrator, outside auditor, outside counsel, custodian,
etc.) that is accurate, complete, objective, relevant, timely, and
understandable
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- Endeavor to ensure full, fair, timely, accurate, and understandable
disclosure in the Fund's periodic reports
- Comply with the federal securities laws and other applicable laws and
rules, such as the Internal Revenue Code
- Act in good faith, responsibly, and with due care, competence and
diligence, without misrepresenting material facts or subordinating
independent judgment to another end
- Respect the confidentiality of information acquired in the course of
their work, except where disclosure is expressly permitted or is
otherwise legally mandated
- Record (or participate in the recording of) entries in the Fund's books
and records that are accurate
- Refrain from using confidential information for personal advantage
VIOLATIONS OF THE CODE
Any action that directly or indirectly contravenes one or more of the Principles
outlined above shall be treated as a violation of this Code unless good cause
for such apparent contravention is found to exist.
Dishonest or unethical conduct or conduct that is illegal will constitute a PER
SE violation of this Code, regardless of whether this Code refers to that
particular conduct.
A violation of this Code may result in disciplinary action, up to and including
termination of employment. The Fund must and will report all suspected criminal
violations to the appropriate authorities for possible prosecution, and will
investigate, address and report as appropriate, non-criminal violations.
ENFORCEMENT OF THE CODE
VIOLATIONS
All persons subject to this Code who observe, learn of, or in good faith,
suspect a current or threatened violation of the Code MUST immediately report
the violation in writing to the Compliance Officer, another member of the Fund's
senior management, or to the Audit Committee of the Board. An example of a
possible Code violation is the preparation and filing of financial disclosure
that omits material facts, or that is accurate but is written in a way that
obscures its meaning.
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DISCLOSURES
All persons subject to this Code shall file a letter (a "Disclosure Letter")
regarding any transaction or relationship that reasonably appears to involve an
actual or apparent conflict of interest with the Fund within ten days of
becoming aware of such transaction or relationship. A Disclosure Letter should
be prepared regarding these transactions or relationships whether you are
involved or have only observed the transaction or relationship. All Disclosure
Letters shall be submitted to the Compliance Officer, or if it is not possible
to disclose the matter to the Compliance Officer, then the Disclosure Letter
shall be submitted to another member of the Fund's senior management or to the
Audit Committee of the Board.
An executive officer of the Fund or the Audit Committee will review all
Disclosure Letters and determine whether further action is warranted. All
determinations will be documented in writing and will be maintained by the
Compliance Officer or other appropriate officers of the Fund.
OUTSIDE SERVICE PROVIDERS
Because service providers to the Fund, such as the Administrator, outside
accounting firm, and custodian, provide much of the work relating to the Fund's
financial statements, you should be alert for actions by service providers that
may be illegal, or that could be viewed as dishonest or unethical conduct. You
should report these actions to the Compliance Officer even if you know, or
think, that the service provider has its own code of ethics covering persons who
are Fund SFOs or employees.
NON-RETALIATION POLICY
SFOs who report violations or suspected violations in good faith will not be
subject to retaliation of any kind. Reported violations will be investigated and
addressed promptly and will be treated confidentially to the extent possible.
ANNUAL CERTIFICATION
SFOs will receive training on the contents and importance of this Code and
related policies and the manner in which violations must be reported and how
Disclosure Letters must be submitted. Each SFO will be asked to certify on an
annual basis that he/she is in full compliance with the Code and any related
policy statements.
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QUESTIONS ABOUT THE CODE
The Fund's Board of Directors has designated Daniel Chafetz to be the Compliance
Officer for purposes of implementing and administering this Code. Any questions
about this Code should be directed to the Compliance Officer.
ADOPTED: December 10, 2003
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