Calif AG sues State Street Bank alleging it overcharged state retirement funds by $200M

Calif sues bank, alleges more than $200M in fraud

SAN FRANCISCO — California Attorney General Jerry Brown is suing State Street Bank and Trust Co., claiming it bilked the state’s largest pension funds of more than $200 million.

The suit announced Tuesday alleges that Boston-based State Street has overcharged the California Public Employees Retirement System (CalPERS) and the California State Teachers’ Retirement System (CalSTRS) with fees for handling foreign currency trades.

Brown launched an independent investigation into the bank after a group of whistleblowers raised the claims in a 2008 lawsuit.

Brown’s office found that State Street charged the highest rates on trades despite being contractually obligated to charge a lower rate.

A spokesman for the bank’s attorney had no immediate comment.