SEC fines fund giant Legg Mason for Libyan bribery scheme

SEC fines fund giant Legg Mason for Libyan bribery scheme
Image: SEC.gov

[Ed. – With all due respect to Gordon Gecko, greed is not good.]

Federal regulators slapped fund giant Legg Mason with a $32.6 million fine for “paying bribes” to Libyan officials under dictator Muammar Gaddafi — the latest Wall Street firm ensnared in a probe into bribes of the terrorist regime.

In the complex scheme, bankers for a Legg Mason subsidiary paid $26.5 million in bribes to the Libyan official between 2004 and 2010 so the country would buy bonds issued by French bank Societe Generale — which Legg Mason then managed and collected fees on, according to the settlement.

Legg Mason bankers took steps to conceal the bribes by speaking in code about the transactions with an official working for Gaddafi, who died in 2011, according to a Monday settlement with the Securities and Exchange Commission.

“I cooked him,” one unnamed banker told another in a recorded phone call, according to the SEC’s order. “Only we have to go there, start the fire, have a barbecue.”

The Libyan funds bought $950 million worth of the bonds over the six-year period, including those linked to the Legg Mason subsidiary, called Permal, the SEC said.

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