2 State Pension Funds Sue RBS Over $123M Loss

TIMOTHY R. BROWN

JACKSON, Miss. (AP) — Mississippi and Massachusetts pension systems are suing to recover $123 million they claim was lost when the Royal Bank of Scotland Group PLC illegally sold 38 million shares of stock without revealing massive debts that nearly made the company collapse.

The lawsuit claims the stock deal violated U.S. security laws.

U.S. District Judge Deborah A. Batts ruled Tuesday that the Mississippi Public Employees' Retirement System and the Massachusetts Pension Reserves Investment Management Board will be co-lead plaintiffs because they lost the most money. The class-action suit was filed in January in the Southern District of New York.

London-based Royal Bank of Scotland nearly collapsed last year and was bailed out by the British government, which now holds 70.3 percent of its shares.

The lawsuit has many plaintiffs, including pension systems in the United Kingdom, and names RBS and former board members as defendants.

A spokeswoman said Friday that the bank would defend the lawsuit but did not comment further.