A bank settled SEC charges in connection with overcharging mutual funds and registered investment company clients for expenses relating to the custody of client assets.
The SEC found that $110 million of the overcharges came from hidden fees when investment company clients used the SWIFT network to send secured financial messages through the network to State Street Bank and Trust Company. The SEC charged the bank with violations of ICA Sections 31(a) ("Accounts and records") and 34(b) ("Destruction and falsification of reports and records") and ICA Rule 31a-1(a) and (b). The bank agreed to disgorge $48.78 million and pay a $44 million civil penalty fine after collecting over $170 million in overcharge fees from clients.
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