Kenneth Leech Admits to Obstructing SEC Probe

The guilty plea settles a high-stakes case centered on 'cherry-picking,' where Leech allegedly waited for trades to show performance before assigning them to specific client accounts. Prosecutors claimed he used this method to bolster his own compensation and improve the performance of his favored 'Macro Opportunities' portfolios, often at the expense of 'Core' and 'Core Plus' investors. By admitting to a single count of obstruction, Leech faces a recommended sentence of six to 12 months, significantly less than the potential consequences of the four fraud charges that were ultimately dropped.

His former employer, Western Asset Management (Wamco), previously agreed to pay a $100 million civil penalty to resolve allegations that it failed to adequately supervise Leech, though the firm did not admit wrongdoing. The fallout from the investigation severely impacted the asset manager; Wamco’s assets under management dropped 40% between June 2024 and March 2025, falling to $228.9 billion. Leech, who was indicted in November 2024, is scheduled for sentencing this September.