Global financial services firm State Street will pay a $115 million criminal penalty and enter into a deferred prosecution agreement with the Department of Justice to resolve its overcharging mutual funds and other registered investment company clients for expenses related to its custody of client assets.
According to State Street’s admissions, for 17 years—from 1998 to 2015—bank executives conspired to add secret markups to “out-of-pocket” (OOP) expenses charged to the bank’s clients, which State Street tacked on to the cost of sending secured financial messages through the Society for Worldwide Interbank Financial Telecommunication network.
