State Street Corporation revealed it is being investigated by government authorities about how it acquires asset-servicing business from public pension plans.
In a quarterly filing Monday, the Boston-based company said it has hired lawyers after receiving subpoenas from the Department of Justice and the Securities and Exchange Commission (SEC).
“We are cooperating with governmental authorities and have asked counsel to conduct an internal review of these matters,” a State Street spokesperson said.
According to State Street’s 10-Q report, legal counsel has been advised to review its “use of consultants and lobbyists in our solicitation of business of public retirement plans.”
The review also includes at least one stance of political contributions by a State Street’s consultants during and after a public bidding process, the firm said.
In the same filing, State Street declared that unfavorable outcomes of the investigation could cause “a material adverse effect on our business and reputation.”
The firm recently settled a class-action lawsuit for $60 million that alleged actions taken by the bank caused investors to buy its stock at inflated prices. It is also being sued by several large US public pension plans for allegedly using deceptive practices in FX transactions.
As of September 30, State Street had $28.5 trillion of assets under custody and $2.42 trillion under management.
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