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California AG to sue major bank for pension fraud

California AG to unveil suit against major bank Tuesday, alleges fraud against pension funds

  • On 9:23 pm EDT, Monday October 19, 2009

OAKLAND (AP) -- The California attorney general's office is planning to file suit against a major institutional bank on accusations that the bank committed fraud against the state's two largest pension funds, CalPERS and CalSTRS.

Attorney General Edmund G. Brown Jr. on Tuesday will unveil details of the lawsuit, which seeks to recover nearly $200 million in illegal overcharges and penalties.

A spokesman for the attorney general's office declined to comment on the bank's identity ahead of a 10 a.m. PDT press conference.

California Public Employees' Retirement System (CalPERS), with about $173 billion in assets as of Jan. 31, administers retirement for California's 1.6 million state workers.

California State Teachers Retirement System (CalSTRS), with a $114 billion portfolio, administers retirement, disability and survivor benefits for California's 833,000 public school educators and their families.

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