United States of America v. R. Keneth (Ken) Leach, II

New York City, New York, criminal defense lawyers represented the Defendant charged with:

5:80B.F DISCLOSURE OF INFORMATION BY COMMISSION (INVESTMENT ADVISER FRAUD)
(1)
18:1505.F OBSTRUCTION OF PROCEEDING BEFORE DEPARTMENTS/AGENCIES
(1s)
15:78J.F MANIPULATIVE AND DECEPTIVE DEVICES (SECURITIES FRAUD)
(2)
7:13A.F & 60.F EMBEZZLEMENT OR LARCENY, EMPLOYEES OF U.S. GOVERNMENT (COMMODITY TRADING ADVISER FRAUD)
(3)
7:13A.F & 9.F EMBEZZLEMENT OR LARCENY, EMPLOYEES OF U.S. GOVERNMENT (COMMODITIES FRAUD)
(4)
7:13A.F STATEMENTS OR ENTRIES GENERALLY (FALSE STATEMENTS)
(5)

Between 2021 and October 2023, Kenneth (Ken) Leach committed fraud and abused the trust placed in him by clients of the investment-management firm WAMCO. LEECH engaged in a criminal scheme commonly known as cherry-picking to compensate for losses in his marquee investment strategy by assigning trades that performed well during their first day into client accounts associated with that investment strategy, and assigning trades that performed poorly over their first day into the accounts of other clients, who were not aware that LEECH was causing them losses to favor others. LEECH’s victims included institutional and retail investors who entrusted LEECH to manage their savings and pension plans. Over the course of his criminal scheme, LEECH allocated trades with net first-day gains of at least approximately $600 million to his favored strategy and clients, and allocated trades with net first-day losses of at least approximately $600 million to strategies and clients to whom he owed an equal fiduciary duty.

In an effort to obstruct the investigation of that fraudulent scheme, LEECH testified before the SEC that he knew where he planned to allocate trades at the time he placed them. The facts showed differently. LEECH owed a fiduciary duty to all of his clients. But between 2021 and October 2023, LEECH improperly engaged in a scheme to delay his trades in order to allocate them in a manner that benefitted some of his clients, to the detriment of others. LEECH’s scheme defrauded clients for whom he was serving a registered financial advisor.

The Defendant elected to plead guilty.

The maximum potential sentence in this case is prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.