Western Asset Agrees to $100M Settlement Over Former Exec Fraud Claims

Dow Jones06-05 21:44

By Katherine Hamilton

Franklin Resources subsidiary Western Asset agreed to pay $100 million to resolve regulators' claims that a former executive engaged in fraud.

Western Asset agreed to pay the civil penalty to settle with the Securities and Exchange Commission, which will be paid into a fair fund for the benefit of investors, it said. The company didn't admit any wrongdoing.

In November 2024, the Justice Department unsealed an indictment charging Kenneth Leech, a former chief investment officer at Western Asset, with securities fraud, investment advisor fraud and commodities fraud.

The department claimed that, between 2021 and 2023, Leech defrauded Western Asset clients by favoring certain clients over others. He assigned more than $600 million of gains to favored clients and the same amount of losses to unfavored clients, the Justice Department alleged.

Western Asset said it agreed to the settlement as a business decision to avoid the distraction of prolonged litigation.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

June 05, 2026 09:44 ET (13:44 GMT)

Copyright (c) 2026 Dow Jones & Company, Inc.

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