{"id":4546,"date":"2008-01-08T07:54:47","date_gmt":"2008-01-08T07:54:47","guid":{"rendered":"https:\/\/www.stockbrokerfraudblog.com\/2008\/01\/600_million_set_aside_by_state_1"},"modified":"2020-09-17T09:24:07","modified_gmt":"2020-09-17T14:24:07","slug":"600-million-set-aside-by-state-1","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/600-million-set-aside-by-state-1\/","title":{"rendered":"$600 Million Set Aside by State Street May Be Tip of Mortgage Litigation Iceburg"},"content":{"rendered":"<p>State Street Corp. announced it established a pre-tax reserve of $618 million billion &#8220;to address legal exposure and other costs associated with the under-performance of fixed-income strategies managed by the company&#8217;s investment management arm,&#8221; blaming exposure to subprime mortgages. The company referenced &#8220;customer concerns as to whether the execution of the strategies was consistent with the customers&#8217; investment intent&#8221; without identifying any specific litigation.<\/p>\n<p>However, the New York Times published an article stating that State Street created the reserve &#8220;after five clients sued it, claiming they had lost tens of millions of dollars in State Street funds they were told would be invested in risk-free debt like Treasuries.&#8221; The article added that State Street&#8217;s reserve &#8220;highlight the legal challenges that lie ahead for financial firms.&#8221;<\/p>\n<p>The first of the five lawsuits referenced by the Times article was filed October 1, 2007, by Prudential Retirement Insurance and Annuity Co. The action &#8220;seeks, among other relief, restitution of certain losses attributable to certain investment funds&#8221; sold by State Street&#8217;s investment management arm, and alleges State Street &#8220;failed to exercise prudent investment management,&#8221; in violation of the Employee Retirement Income Security Act of 1974 (ERISA).<\/p>\n<div class=\"read_more_link\"><a href=\"https:\/\/www.investorlawyers.com\/blog\/600-million-set-aside-by-state-1\/\"  title=\"Continue Reading $600 Million Set Aside by State Street May Be Tip of Mortgage Litigation Iceburg\" class=\"more-link\">Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>State Street Corp. announced it established a pre-tax reserve of $618 million billion &#8220;to address legal exposure and other costs associated with the under-performance of fixed-income strategies managed by the company&#8217;s investment management arm,&#8221; blaming exposure to subprime mortgages. The company referenced &#8220;customer concerns as to whether the execution of the strategies was consistent with [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3825,3752,3745],"tags":[],"class_list":["post-4546","post","type-post","status-publish","format-standard","hentry","category-financial-advisers","category-financial-firms","category-retirement-funds"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>$600 Million Set Aside May Be Tip of Mortgage Litigation Iceburg | SSEK Law<\/title>\n<meta name=\"description\" content=\"State Street announced it established a pre-tax reserve of $618 million billion to address legal exposure costs with fixed-income strategies.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.investorlawyers.com\/blog\/600-million-set-aside-by-state-1\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"$600 Million Set Aside May Be Tip of Mortgage Litigation Iceburg | SSEK Law\" \/>\n<meta name=\"twitter:description\" content=\"State Street announced it established a pre-tax reserve of $618 million billion to address legal exposure costs with fixed-income strategies.\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Shepherd Smith Edwards &amp; 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