Two BNY Mellon employees have sued the company alleging breach of fiduciary duty in the management of a 401(k) plan and ESOP.
Since Jan. 1, 2008, the plaintiffs allege, actions by BNY Mellon and certain senior officers caused “the loss of millions of dollars of participants' retirement savings,” according to the suit filed Nov. 15 in the U.S. District Court in Pittsburgh.
One plaintiff, Joanne Terrazas, is a participant in the 401(k) plan; the other, Diane Brogna, is a participant in the employee stock ownership plan.
The suit alleges BNY Mellon “made a series of false and misleading statements and omissions regarding the exchange rates the company used in connection with” trades relating to foreign-exchange transactions. The fallout forex transactions adversely affected the value of the BNY Mellon stock holdings in the benefit plans, the lawsuit said.
The participants' lawsuit accused the company of “failing to provide complete and accurate information to plan participants” regarding the company's foreign-exchange transactions.
The lawsuit accused the company of “continuing to offer BNY common stock as a plan investment option and permitting the plans to buy and hold shares of BNY common stock when it was imprudent to do so.”
Kevin Heine, a spokesman for BNY Mellon, said in an e-mail that the company has no comment on the lawsuit.
BNY Mellon's foreign-exchange practices are the subject of several lawsuits, including those by the state of Florida, New York City and New York state and the Massachusetts Pension Investment Management Board. BNY Mellon has denied any improper behavior.