SEC v. Ross McLellan, No. LR-26034, District of Massachusetts (June 20, 2024) — Press Release
raw: Ross McLellan
Ross McLellan, No. LR-26034 (June 20, 2024)
summary
Former State Street executive Ross McLellan received a final judgment for orchestrating a scheme to add secret commissions to billions of dollars in securities trades.
paragraph
Ross McLellan, a former State Street Corporation executive, was found to have added unauthorized commissions to billions of dollars in securities trades for at least six clients. The SEC alleged he concealed these extra charges from both the clients and his employer. The court's final judgment enjoins him from violating antifraud provisions of the Securities Act of 1933 and the Exchange Act of 1934.
narrative
The U.S. District Court for the District of Massachusetts entered a final judgment against former State Street Corporation executive Ross McLellan for defrauding clients within the firm's transition management business. McLellan led a scheme to add secret, unauthorized commissions to billions of dollars of securities trades involving at least six institutional clients. He actively took steps to conceal these additional charges from both the clients and other employees within State Street. This civil resolution follows a parallel criminal case where McLellan was convicted in 2018 and sentenced to 18 months in prison. The final judgment enjoins McLellan from violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Exchange Act of 1934. The SEC's enforcement action was supported by several agencies, including the FBI and the UK's Financial Conduct Authority.
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Parties
Securities and Exchange CommissionRoss McLellan
Keywords
state streetmclellanross mclellansecstatestreetsecurities exchangefinal againstsecuritiesrossclientsexchange commissionjune massachusettsmassachusetts enteredentered final
Exhibits & Attached Documents (1)
Extracted insights
Entities 5
- person ross mclellan
- agency sec’s complaint
- agency Securities and Exchange Commission
- agency the sec’s case
- court u.s. district court for the district of massachusetts
Triples 13
- U.S. Securities and Exchange Commission Obtains Final Judgment Against Former State Street Executive
- U.S. District Court for the District of Massachusetts entered a final judgment against Ross McLellan
- Ross McLellan engaging in a scheme to defraud certain customers of State Street’s transition management business
- SEC’s complaint filed on May 13, 2016
- McLellan led a scheme to add secret commissions to billions of dollars of securities trades performed for at least six clients of State Street’s transition management business
- The SEC alleged that the unauthorized commissions were charged in addition to fees the clients had expressly agreed to pay State Street
- McLellan took steps to conceal the commissions from the clients and others within State Street
- McLellan was convicted in October 2018 after a jury trial
- McLellan was sentenced to a term of 18 months’ imprisonment for his role in the scheme
- U.S. District Court for the District of Massachusetts entered a final judgment against McLellan
- The judgment enjoins McLellan from violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder
- The SEC’s case was handled by Eric Heining, Rua Kelly, Rory Alex, and Paul Block of the Boston Regional Office
- The SEC appreciates the assistance of the U.S. Attorney’s Office for the District of Massachusetts, the Federal Bureau of Investigation, the United Kingdom’s Financial Conduct Authority, and the City of London Police
PDF (from attached: complaint)
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Extracted body text (2,066c)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26034 / June 20, 2024 Securities and Exchange Commission v. Ross McLellan, Civil Action No. 16-cv-10874 (D. Mass. May 13, 2016) SEC Obtains Final Judgment Against Former State Street Executive On June 17, 2024, the U.S. District Court for the District of Massachusetts entered a final judgment against Ross McLellan, a former executive of Massachusetts-based State Street Corporation, for engaging in a scheme to defraud certain customers of State Street’s transition management business. According to the SEC’s complaint, filed on May 13, 2016, McLellan led a scheme to add secret commissions to billions of dollars of securities trades performed for at least six clients of State Street’s transition management business, which helps institutional clients move their investments between asset managers or otherwise restructure large investment portfolios. The SEC alleged that the unauthorized commissions were charged in addition to fees the clients had expressly agreed to pay State Street and that McLellan took steps to conceal the commissions from the clients and others within State Street. In a parallel criminal case, McLellan was convicted in October 2018 after a jury trial and later sentenced to a term of 18 months’ imprisonment for his role in the scheme. On June 18, 2024, the U.S. District Court for the District of Massachusetts entered a final judgment against McLellan. The judgment enjoins McLellan from violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC’s case was handled by Eric Heining, Rua Kelly, Rory Alex, and Paul Block of the Boston Regional Office, with assistance from Mark Gera of the SEC’s Division of Examinations. The SEC appreciates the assistance of the U.S. Attorney’s Office for the District of Massachusetts, the Federal Bureau of Investigation, the United Kingdom’s Financial Conduct Authority, and the City of London Police. SEC Complaint
OCR text (2,066c · html-text · 99% conf)
U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26034 / June 20, 2024 Securities and Exchange Commission v. Ross McLellan, Civil Action No. 16-cv-10874 (D. Mass. May 13, 2016) SEC Obtains Final Judgment Against Former State Street Executive On June 17, 2024, the U.S. District Court for the District of Massachusetts entered a final judgment against Ross McLellan, a former executive of Massachusetts-based State Street Corporation, for engaging in a scheme to defraud certain customers of State Street’s transition management business. According to the SEC’s complaint, filed on May 13, 2016, McLellan led a scheme to add secret commissions to billions of dollars of securities trades performed for at least six clients of State Street’s transition management business, which helps institutional clients move their investments between asset managers or otherwise restructure large investment portfolios. The SEC alleged that the unauthorized commissions were charged in addition to fees the clients had expressly agreed to pay State Street and that McLellan took steps to conceal the commissions from the clients and others within State Street. In a parallel criminal case, McLellan was convicted in October 2018 after a jury trial and later sentenced to a term of 18 months’ imprisonment for his role in the scheme. On June 18, 2024, the U.S. District Court for the District of Massachusetts entered a final judgment against McLellan. The judgment enjoins McLellan from violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC’s case was handled by Eric Heining, Rua Kelly, Rory Alex, and Paul Block of the Boston Regional Office, with assistance from Mark Gera of the SEC’s Division of Examinations. The SEC appreciates the assistance of the U.S. Attorney’s Office for the District of Massachusetts, the Federal Bureau of Investigation, the United Kingdom’s Financial Conduct Authority, and the City of London Police. SEC Complaint