Bank of New York Mellon Corp., the world’s largest custody bank, agreed to pay $280 million to settle a lawsuit blaming the company for losses in connection with Sigma Finance Inc.
BNY Mellon said today that it took an after-tax charge of $210 million in the second quarter to include part of the anticipated cost of the settlement. The accord is subject to court approval, the New York-based bank said in a statement.
“The Sigma settlement agreement reflects the meaningful progress we are making in navigating the litigation environment that affects our company and the industry overall,” Gerald L. Hassell, BNY Mellon’s chief executive officer, said in the statement.
BNY Mellon was sued in federal court in Oklahoma by CompSource Oklahoma, a state’s workers’ compensation insurance company, over losses related to Sigma, the operator of a structured investment vehicle that collapsed in September 2008.
The settlement agreement couldn’t immediately be independently verified in court records.
The case is CompSource Oklahoma v. BNY Mellon, 08-cv-00469, U.S. District Court, Eastern District of Oklahoma (Muskogee).