NTMA CEO Says State Street Overcharging Matter Isn’t Closed
Ireland’s bond agency Chief Executive John Corrigan said that the organization reserved its position on potential future action against State Street Corp. (STT) after the bank overcharged more than 3 million euros on the sale of securities on behalf of the state.
Corrigan told lawmakers in Dublin today that the National Treasury Management Agency is waiting for the outcome of an investigation by the U.K.’s Financial Services Authority. The NTMA has advised the Irish police force of the matter, he said.
“It is on hold until we see where the FSA lands,” Corrigan said. The NTMA has been refunded the amount by State Street, Corrigan said. Corrigan said the transaction was an “eye-opener” for the agency, which had met with a vice chairman of the bank on the matter in Dublin.
“This relates to a transition management matter that we self-reported to the FSA in September 2011. In a limited number of instances, we charged commissions on transition management mandates that were not consistent with our contractual agreements,” State Street said in an e-mailed statement. “The actions of these former employees and their interaction with a small number of clients do not reflect the high standards of conduct, communications and transparency that State Street expects. We took swift and appropriate disciplinary actions in response to this conduct.”
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