MANHATTAN, N.Y. (Legal Newsline) - The Bank of New York Mellon last week filed a motion to dismiss a lawsuit filed by New York Attorney General Eric Schneiderman over the bank's foreign currency exchange transactions.
BNY Mellon filed papers in the New York State Supreme Court in Manhattan Tuesday, according to the court's online records library.
The bank argues it properly reported the rates it applied to preauthorized foreign currency transactions.
"A party that knows exactly what it is getting, and at what price, cannot, as a matter of law, have been defrauded," it wrote.
In October, Schneiderman, along with the city of New York, sued BNY Mellon for defrauding clients.
The attorney general alleges BNY Mellon over a 10-year period "consistently misrepresented" to customers the rates it would give foreign currency transactions.
Instead of providing the best interbank rates, as it promised, the bank gave the worst or nearly the worst rates of the trading day, Schneiderman alleges.
Both public and private pension funds, including the New York City Employee Retirement System and the State University of New York, fell victim to the bank, the attorney general says.
Schneiderman's lawsuit seeks to recover the profits BNY Mellon illegally earned by allegedly deceiving its customers -- nearly $2 billion.
"Banks are expected to provide a reliable and honest service to their customers. Unfortunately, this does not seem to be the case as it relates to the Bank of New York Mellon and their foreign exchange services provided to the New York City Pension Funds," Ricardo E. Morales, deputy comptroller for legal affairs and general counsel, said in a statement at the time.
"We remain confident that New York City's pensioners and taxpayers will recoup what they are rightfully owed."
From Legal Newsline: Reach Jessica Karmasek by email at email@example.com.
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