Voya Investment Management Llc

Allegations: THE SEC SETTLEMENT ORDER CONTAINED THE FOLLOWING FINDINGS, WHICH VOYA INVESTMENT, LLC ("VIL") NEITHER ADMITTED NOR DENIED: (1) THE SECURITIES LENDING PRACTICES OF VIL RELATING TO ITS INSURANCE-DEDICATED FUNDS (THE "FUNDS") INCLUDED CALLING BACK LOANED SECURITIES IN ADVANCE OF THE DIVIDEND RECORD DATE IN ORDER TO QUALIFY SUCH DIVIDENDS FOR FAVORABLE TAX TREATMENT; (2) THE RECALL ENABLED ITS INSURANCE AFFILIATES, WHICH WERE THE RECORD SHAREHOLDERS OF THE FUNDS' SHARES, TO TAKE A TAX DEDUCTION KNOWN AS THE DIVIDEND RECEIVED DEDUCTION WHILE THE FUNDS AND INDIVIDUALS INVESTED IN THOSE FUNDS THROUGH THEIR VARIABLE LIFE ANNUITY CONTRACTS AND VARIABLE LIFE INSURANCE POLICIES (COLLECTIVELY, THE "CONTRACT HOLDERS") LOST SECURITIES LENDING INCOME DURING THE PERIOD WHEN THE SECURITIES WERE RECALLED; (3) VIL DID NOT DISCLOSE THE CONFLICT OF INTEREST THAT AROSE FROM THE RECALL PRACTICE TO THE FUNDS' BOARDS OF DIRECTORS/TRUSTEES; AND (5) VIL FAILED TO DISCLOSE IN THE FUNDS' PROSPECTUSES THAT THEIR PRACTICE OF RECALLING SECURITIES WOULD BENEFIT THEIR AFFILIATES WHILE DEPRIVING THE FUNDS AND THE AFFILIATES' CONTRACT HOLDERS OF INCOME. THE SEC FOUND THAT, AS A RESULT OF THIS CONDUCT, VIL VIOLATED SECTIONS 206(2) AND 206(4) OF THE INVESTMENT ADVISERS ACT OF 1940, ("ADVISER'S ACT") AND RULE 206(4)-8 THEREUNDER. Status: Final Sanction Detail: $1,623,133.66 OF THE DISGORGEMENT, PENALTY AND PREJUDGMENT INTEREST WAS PAID TO THE UNITED STATES TREASURY ON MARCH 16, 2018. ON MARCH 16, 2018, $2,024,355.48 WAS PLACED INTO ESCROW FOR PAYMENT TO THE AFFECTED FUNDS, AND WAS DISBURSED TO THE AFFECTED FUNDS ON MARCH 27, 2018. Summary: PURSUANT TO A SETTLEMENT ORDER DATED MARCH 8, 2018, VIL AGREED TO (1) CEASE AND DESIST FROM CERTAIN CONDUCT, (2) CENSURE, (3) PAYMENT OF A CIVIL PENALTY IN THE AMOUNT OF $500,000, (4) PAYMENT OF DISGORGEMENT IN THE AMOUNT OF $2,635,490.25 AND (5) PAYMENT OF PRE-JUDGEMENT INTEREST IN THE AMOUNT OF $511,978.89.