May 13, 2021

Financial services company State Street Corporation will pay a $115 million criminal penalty and enter into a deferred prosecution agreement following its voluntary disclosure to authorities that, over the course of 17 years, the bank defrauded its clients out of $290 million.  State Street  admitted that it secretly marked up “out-of-pocket” (OOP) expenses charged to clients, despite telling clients that OOP expenses were passed through without markups. State Street executives took steps to conceal the mark-ups from clients, including by misleading clients when they inquired about what they were being charged for OOP expenses. As part of the settlement, defendant agreed to cooperate with ongoing investigations, to enhance its compliance program, and to retain an independent corporate compliance monitor for a period of two years. DOJ

Tagged in: Criminal Proceedings, Financial and Investment Fraud, Financial Institution Fraud, Misrepresentations,