California Pension Fund Sues NYSE
SACRAMENTO (AP) _ The nation’s largest pension fund announced Tuesday it is filing a class action lawsuit against the New York Stock Exchange and seven trading firms, alleging that fraudulent practices cost it millions of dollars in recent years.
The $154 billion California Public Employees Retirement System, representing an estimated 1.4 million members, will seek to recover pension fund investment money it lost because of alleged fraud at the stock exchange, said California Treasurer Phil Angelides.
The lawsuit names seven specialist trading firms that it claims defrauded the pension firm, which has $60 billion invested on Wall Street. The job of specialist firms is to make a market in stocks assigned to them by matching buyers and sellers on the NYSE trading floor.
CALPERS is seeking an unspecified amount of money, but officials of the pension fund said it could add up to hundreds of millions of dollars if others also join the suit.
``It will be painstaking work,″ said CalPERS President Sean Harrigan, regarding the legal process the lawsuit will trigger to determine the amount of losses. ``But every dollar lost is a dollar is dollar that should have gone to finance pensions of people we serve.″
California officials said they are also seeking others to join them in the lawsuit, saying it could potentially include all investors who traded at the New York Stock Exchange for the last five years.
Officials said decided to sue, rather than rely on the U.S. Securities and Exchange Commission, because the SEC has not done its job.
``Over the last two years the SEC has been a day late and a dollar short every step of the way,″ Angelides said.