Franklin Templeton is facing scrutiny as it disclosed an SEC probe that has led to the decision to shut down a $2 billion fund. The investigation centers on Western Asset Management, where executive Ken Leech has taken a leave of absence amid allegations of 'cherry-picking' trades. Federal prosecutors in New York are examining whether Leech allocated winning trades to favored accounts, a practice that could violate securities regulations. The SEC and Department of Justice are both involved in the inquiry, which focuses on approximately 17,000 trades executed by Leech. Following these developments, Franklin Templeton's shares have declined significantly, reflecting investor concerns over the implications of the investigations.