The SEC announced fraud charges against Stephen Kenneth Leech, the former co-chief investment officer of registered investment adviser Western Asset Management Company, or WAMCO, for “engaging in a multi-year scheme to allocate favorable trades to certain portfolios, while allocating unfavorable trades to other portfolios, a practice known as cherry-picking.” The SEC’s complaint alleges that from at least January 2021 through October 2023, Leech placed trades with brokers and then routinely waited until later in the trading day to allocate the trades among clients in the portfolios he managed. The Fly notes that Franklin Resources (BEN) owns Western Asset Management.
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