A federal judge in Pennsylvania has given final approval to a $14 million settlement against New York Life Insurance Co. by employees who said the companys retirement plans were improperly invested into mutual funds owned by New York Life.
According to the order, an independent consultant advised New York Lifes board that their pension plans could save more than $7 million in fees by moving its investments from proprietary funds to a separately managed program. Despite this advice, the trustees did not take action until the plaintiffs filed a class-action lawsuit.
The plaintiffs, who are current and former New York Life employees, charged that the company breached its fiduciary duties under the ERISA act.
A statement by the board of trustees said the plans investments and menu of investment options have always been prudently selected, and the fees are appropriate.