TALLAHASSEE, Fla. (Legal Newsline) -- Florida Attorney General Pam Bondi announced Friday a $28 million settlement with the state's custodian bank, the Bank of New York Mellon, resolving allegations it overcharged the state's retirement trust fund.
The Bank of New York Mellon allegedly improperly reported the state's foreign currency transactions and kept the difference between the inflated price and the actual execution price.
The matter began as a qui tam, or whistleblower, complaint, which Bondi's office intervened in to file an amended complaint in 2011.
"We worked hard to achieve this substantial recovery on behalf of Florida's retirement fund," the attorney general said in a statement.
The Bank of New York Mellon allegedly overcharged the Florida Retirement System Trust Fund by millions of dollars.
Under the terms of the settlement, the Bank of New York Mellon will give the state full compensation for past foreign currency trades and ensure full transparency on the pricing of trades going forward. The state of Florida has billions of dollars in international investments requiring many foreign currency transactions.
The agreement also resolves allegations related to investments made by the Bank of New York Mellon on behalf of the trust fund in medium-term notes issued by Sigma Finance Inc. In September 2008, Sigma defaulted on certain notes and went into receivership.