NEW YORK (Reuters) - California’s attorney general sued State Street Corp (STT.N) on Tuesday for committing an “unconscionable fraud” against the state’s largest pension funds, and is seeking to recover more than $200 million in alleged illegal overcharges and penalties.
The lawsuit contends that State Street Bank and Trust overcharged the California Public Employees’ Retirement System (CalPERS) and the California State Teachers’ Retirement System (CalSTRS) for the costs of executing foreign currency trades since 2001, Attorney General Jerry Brown said in a statement.
Brown’s office estimated that the overcharges exceeded $56.6 million. The lawsuit seeks to recover triple damages, civil penalties and other costs. The lawsuit was unsealed by a Sacramento Superior Court judge, Brown said.
A representative of Boston-based State Street was not immediately available for comment.
CalPERS oversees about $190.4 billion of assets and manages retirement benefits for 1.6 million state workers, according to its website. CalSTRS oversees $126.9 billion of assets and provides retirement benefits for 833,000 public school workers, according to its website.
State Street shares were down $3.70, or 7.1 percent, at $48.55 in afternoon trading on the New York Stock Exchange. The company earlier Tuesday reduced its full-year outlook.