Massachusetts pension fund gets $11.3 million settlement

By BenefitsPro


By Dan Berman

The Massachusetts public pension fund will receive $11.3 million from Countrywide Securities Inc. as a result of the company’s residential mortgage securitization activities in the state, the attorney general announced.

In addition to the payment to the Pension Reserves Investment Management Board, Countrywide will pay the state $6 million, according to Attorney General Martha Coakley.

The settlement is the result of a series of investigations by the state that have resulted in settlements. J.P. Morgan agreed late last year to pay $7 million to the pension fund.

“We are pleased to return these critical public funds to the state pension system,” Coakley said. “It is important to hold Wall Street accountable for its role in the subprime lending crisis. Our office will continue its leading role in this area as we work to help homeowners and others harmed by investment banks.”

At the end of 2012, the state fund had $21.5 billion in unfunded liabilities, a study by the Massachusetts Taxpayer Foundation said. In July, the fund’s assets were reported to be $53.2 billion, up 12 percent for the year. The previous year, assets were essentially unchanged.

In early December, the pensions board agreed to a $265 million settlement with Alpha Appalachia Holdings Inc., a mining company. After a 2010 mining accident, the board accused the company of misrepresenting its safety procedures.

Countrywide, once the largest mortgage lender in the nation, was purchased for about $4 billion by Bank of America in 2008 after the housing bubble burst.

Originally published on BenefitsPro.com