By Chris Villani

Law360 (December 10, 2020, 4:03 PM EST) -- A former State Street Corp. vice president convicted of tacking on unauthorized charges to huge international transactions will not be able to get out of prison five months into his 18-month sentence, as a judge ruled Thursday he does not face a substantial COVID-19 risk.

Ross McLellan had sought compassionate release from the minimum security prison camp in central Massachusetts where he is serving his term, citing Type 2 diabetes and obesity as factors that put him at a heightened risk should he contract the virus.

But U.S. District Judge Leo T. Sorokin denied the request, saying that the novel coronavirus is not a pressing concern at the prison camp in question and that McLellan has not met the standard for early release.

"The camp is presently less than half full and has no active COVID-19 cases among its inmates," Judge Sorokin wrote. "Nothing in the record suggests that McLellan is currently exposed to unduly harsh or excessively risky conditions of confinement."

The judge also wrote that "McLellan committed a serious crime for which he has served less than a third of his sentence — and less than the amount of time his less culpable co-conspirator served as a result of a sentence also imposed by this court."

A jury convicted McLellan in 2018 of wire and securities fraud for supervising a scheme in which pennies per share were tacked on to massive international transactions for huge foreign clients without their knowledge.

He appealed the conviction, arguing that the conduct in question took place largely in London and did not have enough of a tie to the United States. The First Circuit ruled in May that McLellan had used domestic wires to further his crimes, allowing the convictions to stand.

Judge Sorokin sentenced McLellan to a term well below the suggested sentencing guideline range, something he noted in Thursday's order and something McLellan's attorney, Martin Weinberg of the Law Offices of Martin G. Weinberg PC, also pointed out in a statement.

"We have a great deal of respect for Judge Sorokin, who recognized Mr. McLellan's lifetime of hard work and the depths of his family commitments in imposing a sentence substantially lower than the applicable guidelines," Weinberg said Thursday. "If circumstances change, we will determine whether a further request for compassionate relief is warranted."

A government representative declined to comment.

In addition to his criminal case, McLellan is looking to settle a parallel suit brought by the U.S. Securities and Exchange Commission. Earlier this week, a different federal judge declined to sign off on a final judgment between the SEC and the former executive, saying he still needs to be convinced as to why McLellan should not be fined for what was a financial crime.

Federal prosecutors said McLellan worked with two lower-level directors, Edward Pennings and Richard Boomgaardt, to add basis points, pennies per transaction, to multibillion-dollar trades for overseas clients. The prosecution framed McLellan as the mastermind of the scheme.

Both Pennings and Boomgaardt pled guilty to conspiracy.

State Street admitted to the overcharges in 2017 and said it accepted responsibility for the actions prosecutors attributed to McLellan, Pennings and Boomgaardt. The bank agreed to pay $64.6 million in criminal and civil fines to end federal investigations.

The government is represented by Stephen E. Frank of the U.S. Attorney's Office for the District of Massachusetts and William Johnston of the U.S. Department of Justice's Fraud Section.

McLellan is represented by Martin G. Weinberg and Maksim Nemtsev of the Law Offices of Martin G. Weinberg PC.

The case is U.S. v. McLellan et al., case number 1:16-cr-10094, in the U.S. District Court for the District of Massachusetts.

--Editing by Daniel King.

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