Fidelity, Russell and SEI Quizzed by DOJ as Ken Leech Probe Ramps Up
At times, Wamco rivaled the likes of BlackRock Inc. and Pacific Investment Management Co. in size, but its streak of lackluster performance over the past three years prompted an investor exodus.
Pasadena, California-based Wamco, which is owned by Franklin Resources Inc., has previously said it’s cooperating with the SEC and DOJ after launching its own investigation into about 17,000 trades made by Leech over three years.
The transactions were spread across 38 accounts and three strategies, Bloomberg previously reported.
Russell Investments and SEI also previously disclosed that they’re ending relationships with Wamco, which oversaw money for several investment funds offered by the two money managers.
Fidelity Investments’ Strategic Advisers Core Income Fund pared its allocations to Wamco’s Core Plus Bond Fund over several quarters, according to data compiled by Bloomberg.
Franklin Resources said on Oct. 9 that Wamco clients pulled $37 billion total in the quarter ended Sept. 30, and the data show assets in the firm’s flagship Core and Core Plus mutual funds have plunged.
As of the end of the period, Wamco managed about $353 billion, which is roughly one-fifth of Franklin’s overall assets.
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