Money managers under the microscope
It may be the awakening we all experience in the spring, but this month two different class actions against previous financial giants were started by a bunch of pension schemes. In both cases a small group of such previously semi-obscure institutions have de facto come under the spot light for suing companies– and their executives– which they say have been less than straight about their financial shape and lost them millions.
Earlier this week five schemes, including Europe’s second largest one, clubbed to become lead plaintiff in a class action over about $274 million losses incurred since Bank of America took over Merrill Lynch.
Earlier this month two public pension schemes in the UK, Merseyside and North Yorkshire, started a class action against Royal Bank of Scotland and former chief executive Fred Goodwin. The legal firm working on the case, Coughlin Stoia Geller Rudman & Robbins, hired Cherie Blair. One of its lawyers even told Reuters: “Never underestimate Cherie Blair,” leaving a faint promise for fire works.
The UK schemes are seeking damages for the losses that followed the fall in the value of their investments when RBS was bailed out by the UK government.