SEC Sets Sights On State Street Over MBS Marketing

Law360, New York (June 29, 2009, 12:00 AM EDT) -- U.S. Securities and Exchange Commission staff have decided to recommend hitting State Street Corp. with a lawsuit related to allegations that a division improperly marketed funds containing risky mortgage-backed securities, the company said Monday.

In an SEC filing, the company revealed that its principal subsidiary, State Street Bank and Trust Co., had received a Wells notice from the SEC related to an ongoing SEC investigation into disclosures and management by State Street Global Advisors of certain active fixed-income strategies.

The Wells notice warns State Street that...
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