SEC Charges State Street Over Subprime Mortgage Investments
Boston-based State Street Corp. agreed to pay more than $300 million on Thursday to settle civil charges by the U.S. Securities and Exchange Commission alleging the bank misled investors about its exposure to subprime mortgages. In a civil complaint filed in a Boston federal court and a related administrative order, the SEC said the bank selectively disclosed information about its subprime-mortgage investments to specific investors. The settlement money will go to investors who lost money during the 2007 subprime market meltdown. The settlement is in addition to nearly $350 million the bank previously agreed to pay to settle private claims, the agency said. The settlement came about following a joint investigation between the SEC and state regulators in Massachusetts, including the state's Attorney General and Secretary of State offices.