Ex-State Street executive gets prison in U.S. for defrauding clients
BOSTON (Reuters) - A former State Street Corp executive was sentenced on Tuesday to 18 months in prison after being convicted of taking part in a scheme to overcharge customers of the bank by applying secret commissions on billions of dollars’ worth of trades.
Ross McLellan, a former executive Vice President at State Street Corp, enters the federal courthouse in Boston, Massachusetts, U.S., June 18, 2018. REUTERS/Nate Raymond
Ross McLellan, 46, was sentenced by U.S. District Judge Leo Sorokin in Boston after a federal jury in June found the one-time State Street executive vice president guilty of charges including conspiracy, securities fraud and wire fraud.
FILE PHOTO: Ross McLellan, a former executive vice president of State Street Corporation, exits the federal courthouse in Boston, Massachusetts, June 4, 2018. REUTERS/Nate Raymond/File Photo
“The issue here is you can’t lie,” Sorokin said. “Truth matters. You can’t tell people you’re going to charge one thing and charge another.”
Prosecutors had sought five years in prison, saying McLellan oversaw a scheme that defrauded institutional clients including Irish, British and Dutch pension funds and the Kuwait Investment Authority out of millions of dollars.
The case followed a 2014 settlement between State Street and the UK Financial Conduct Authority in which the bank paid a fine of 22.9 million pounds, or $38 million at the time, for charging six customers mark-ups on certain transactions.
In 2017, Boston-based State Street agreed to pay $64.6 million to resolve related U.S. criminal and civil investigations and entered a deferred prosecution agreement.
Reporting by Nate Raymond in Boston; Editing by David Gregorio
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