Oklahoma Attorney General Scott Pruitt is investigating custodian banks that hold state pension fund assets, seeking information on investment transactions and foreign currency exchanges, Mr. Pruitt said in a news release.
Mr. Pruitt announced Thursday that he sent letters to custodian banks for the $10.1 billion Oklahoma Teachers' Retirement System, the $7.2 billion Oklahoma Public Employees Retirement, the $1.8 billion Oklahoma Police Pension & Retirement System and the $1.6 billionOklahoma Firefighters Pensions and Retirement System. All are based in Oklahoma City.
J.P. Morgan Chase is custodian for the teachers' fund; Northern Trust, the public employees' fund; Bank of New York Mellon, the police fund; and State Street, the firefighters' fund,
Mr. Pruitt said in the release that there have been claims of potential fraud against the banks, but he did not indicate who made the claims. Mr. Pruitt could not be reached for comment.
Oklahoma's move follows lawsuits filed by pension funds by pension funds in California, Arkansas, Virginia and Florida, alleging their custodian banks overcharged them for currency trades, as well as an SEC investigation into the issue.
James Wilbanks, executive director of the Oklahoma Teachers plan, said system officials were not involved in Mr. Pruitt's decision to investigate the banks and were not contacted by him prior to the announcement.
“We are fully supportive of the attorney general's efforts to look at the practices of custodial banks and ensure that our clients' funds are being treated the way they need to be treated,” he said in a telephone interview.
Executives of the other three funds could not be reached for comment.