New York State Common Retirement Fund, Albany, and the five pension funds in the New York City Retirement Systems will receive a total of $624 million from Countrywide Financial and KPMG to settle a federal class-action lawsuit accusing the mortgage lender of violating securities law by making misstatements and omitting material facts about underwriting risky loans.
In a news release from New York State Comptroller Thomas P. DiNapoli, sole trustee to the $129.4 billion state pension fund, Countrywide will pay plaintiffs $600 million, and accounting firm KPMG will pay $24 million.
The settlement still must be approved by Judge Mariana R. Pfaelzer of the U.S. District Court for the Central District of California, Los Angeles. Class members also must approve the settlement.
“This is a very good settlement that helps repair the damage Countrywide had done to our fund and the other members of the class,” Mr. DiNapoli said in the news release. “It also serves notice to the marketplace that we will vigorously protect the fund and our members from abuse.”
The five New York City pension funds, with a combined $105 billion, are the Employees’ Retirement System, Teachers’ Retirement System, Police Pension Fund, Fire Department Pension Fund and the Board of Education Retirement System.
Neither a Countrywide nor a KPMG spokesman could be reached for comment.