State Street Corp. received a Wells notice from the SEC for its use of consultants to solicit business from public pensions prior to 2011. In at least one instance, according to media reports, a consultant hired by the company made political contributions in the time period during and after the state was engaged in public bidding.
A Wells notice informs the company that the SEC may bring a civil enforcement action against it. It notifies them of the substance of the charges that it intends to bring against the recipient. Around 20 percent of those receiving a notice do not end up facing charges, according to a Wall Street Journal study.
State Street is under investigation for public pensions in two states. In November, it disclosed that it was under investigation in connection with a $32 billion contract for Ohio’s three largest retirement systems that it won. The Ohio lobbyist hired by State Street apparently had extensive contact with Ohio’s deputy treasurer at the time. The contract was overseen by the Ohio treasurer’s office.
Many states have banned those making political contributions from seeking pension business, and the SEC introduced restrictions in 2010 targeted investment business awarded to financial institutions by public officials because of campaign contributions, or so called “pay to play” activities.
If you have evidence of improper lobbying for government contracts or business by a public corporation, contact one of our SEC whistleblower attorneys to discuss reporting it via the whistleblower program. An attorney can be reached by either our contact form or by phone call to 1-800-590-4116.