Credit Suisse Group AG has agreed to pay $81 million to settle its part of a federal class action lawsuit brought by three U.S. public pension funds alleging that six major investment banks colluded to overcharge investors and retain control of the $1.72 trillion equity loan market.
The lawsuit, filed in 2017, accused Credit Suisse along with Bank of America, Goldman Sachs, JP Morgan Chase, Morgan Stanley and UBS of violating antitrust law by conspiring to overburden investors and obstructing efforts to create competitive electronic securities lending exchanges, according to original court documents.
According to settlement documents filed Feb. 11 in the U.S. District Court in New York, Credit Suisse has “denied and continues to specifically deny each and all of the claims and allegations of wrongful conduct alleged in the action.”
The lawsuit alleged that the banks had colluded to block the development of competitive exchanges since 2009 through a bank-created securities lending platform called EquiLend. The lawsuit alleged that the banks created the platform to prevent access to other markets in order to obtain better prices on equity loans.
The lawsuit was filed in the United States District Court in New York by the $42.9 billion Iowa Public Employees Retirement System, Des Moines; $21.5 billion from the Employee Retirement System of Orange County, Santa Ana; and $3.4 billion Sonoma County Employees’ Retirement Association, Santa Rosa, CA.
The law firms Cohen Milstein Sellers & Toll and Quinn Emanuel Urquhart & Sullivan represent the pension funds. Daniel L. Brockett, partner at Quinn Emanuel, could not be immediately reached for further information.