Ken Leech Sued by SEC Over Alleged ‘Cherry-Picking’ Scheme

Bloomberg11-26

(Bloomberg) -- Former Western Asset Management Co. co-Chief Investment Officer Ken Leech was sued by US regulators for engaging in an alleged “cherry-picking” scheme to disproportionately allocate ...

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Leech has also been charged criminally, the SEC said.“The scale and duration of Leech’s allegedly fraudulent conduct amounts to a shocking betrayal of his fiduciary obligations to his clients, who paid dearly for his transgressions,” said Sanjay Wadhwa, acting director of the SEC’s Division of Enforcement. “Investment advisers are at all times obliged to perform their functions, including trade allocations, in a manner that puts their clients’ inte","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BEN":"富兰克林资源","BK4585":"ETF&股票定投概念","BK4135":"资产管理与托管银行","BK4588":"碎股"},"translate_title":"肯·里奇(Ken Leech)因涉嫌“挑选樱桃”计划被SEC起诉","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"BEN":0.9},"content_text":"(Bloomberg) -- Former Western Asset Management Co. co-Chief Investment Officer Ken Leech was sued by US regulators for engaging in an alleged “cherry-picking” scheme to disproportionately allocate better performing trades to favored portfolios and worse-performing trades to others.\nThe Securities and Exchange Commission sued Leech in federal court in Manhattan on Monday, alleging that he allocated trades hours after executing them, often waiting until the end of the trading day or afterward, which went against the firm’s training for portfolio managers. Leech has also been charged criminally, the SEC said.\nUS authorities have been examining whether Leech parceled out winning trades to favored clients at the expense of others — a practice known as cherry-picking. Investors have pulled billions of dollars from Wamco funds since the firm disclosed criminal and civil investigations earlier this year. Leech took a leave of absence as co-chief investment officer in August after the SEC warned he could face a potential enforcement action.\n“The scale and duration of Leech’s allegedly fraudulent conduct amounts to a shocking betrayal of his fiduciary obligations to his clients, who paid dearly for his transgressions,” said Sanjay Wadhwa, acting director of the SEC’s Division of Enforcement. “Investment advisers are at all times obliged to perform their functions, including trade allocations, in a manner that puts their clients’ interests first. As alleged, Leech abdicated that all-important duty for years.”\nJonathan S. Sack, a lawyer for Leech, called the allegations “unfounded.”\n“Ken Leech has an unblemished record over nearly 50 years as a trader and portfolio manager,” Sack said in a statement. “Mr. Leech received no benefit from the alleged misconduct. We are confident that he acted properly at all times, and Mr. Leech will defend himself vigorously.”\nA spokesperson for Franklin Resources Inc., which owns Wamco, had no immediate comment.\nThe case is Securities and Exchange Commission v Leech, 24-cv-9017, US District Court, Southern District of New York.\n(Updates with SEC statement in fourth paragraph)\n©2024 Bloomberg L.P.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"-1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2486108061"}