Defendant Name: Western Asset Management Company

Defendant Type: Subsidiary of Public Company
Public Company Parent: Legg Mason, Inc.
SIC Code: 6282
CUSIP: 52490110

Initial Case Details

Legal Case Name In the Matter of Western Asset Management Company
First Document Date 27-Jan-2014
Initial Filing Format Administrative Action
File Number 3-15689
Allegation Type Investment Advisers/Investment Companies

Violations Alleged

Other
• Section 206(2), 206(4), Rule 206(4)-7 Advisers Act

Related Violations Alleged

Western Asset Management Company is alleged to have aided and abetted an unidentified individual or entity's violation of Section 17(a)(1), 17(a)(2) Investment Company Act.
Western Asset Management Company is alleged to have caused an unidentified individual or entity's violation of Section 17(a)(1), 17(a)(2) Investment Company Act.

Resolutions

First Resolution Date 27-Jan-2014
Headline Total Penalty and Disgorgement $10,620,392

Related Documents:

IA-3763 27-Jan-2014 Administrative Proceeding
Order Instituting Administrative and Cease-and-Desist Proceedings Pursuant to Sections 203(e) and 203(k) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order
On January 27, 2014, the SEC instituted settled administrative and cease-and-desist proceedings against Western Asset Management Company. According to the SEC: "These proceedings arise out of an investment adviser's failure to disclose its violation of an issuer-imposed restriction prohibiting plans subject to Part 4 of Subtitle B of Title 1 of the Employee Retirement Income Security Act ('ERISA plans') from participating in a private placement. Respondent was aware no later than October 2008 that it had breached this offering restriction by allocating the security to ERISA accounts that it managed, yet failed to take prompt corrective action, contrary to its disclosed error correction policy. Specifically, Respondent did not notify most of its affected ERISA clients until August 2010, more than a year after Respondent had liquidated the securities out of all client accounts."
2014-13 27-Jan-2014 Press Release--Administrative Proceeding
SEC Charges Legg Mason Affiliate With Defrauding Clients
On January 27, 2014, the SEC announced "sanctions against a California-based investment adviser for concealing investor losses that resulted from a coding error and engaging in cross trading that favored some clients over others." The SEC's announcement encompasses two separate administrative proceedings against Western Asset Management Company (File Numbers: 3-15688 and 3-15689).