Bank of New York Mellon Corp. and federal prosecutors are close to settling some claims in a government lawsuit accusing the bank of overcharging customers for foreign-exchange trading, according to a court filing.
U.S. Attorney Preet Bharara in New York requested a one-week extension for BNY Mellon to respond to the complaint because the two sides “are presently close to reaching an agreement that would resolve certain claims,” according to letter filed Monday with U.S. District Judge Lewis A. Kaplan. The judge granted the request, according to the court docket.
Mr. Bharara sued New York-based BNY Mellon on Oct. 4, the same day the bank was sued by New York Attorney General Eric Schneiderman for allegedly defrauding public pension funds of $2 billion over 10 years. Attorneys general in Virginia and Florida and some California counties filed similar complaints.
The cases center on the pricing of small foreign-exchange transactions handled automatically by the custody banks on behalf of pension funds, a service known as standing instruction. In some of the cases the banks have said they acted as a principal, selling one currency for another in arms-length transactions at a set price that customers were free to accept or reject.
Kevin Heine, a spokesman for BNY Mellon, didn’t return a phone call or e-mail seeking comment on the government’s court filing after regular business hours.
The case is U.S. v. The Bank of New York Mellon Corp., 11-6969, U.S. District Court, Southern District of New York (Manhattan).