(January 11) — An Illinois pension fund sued Goldman Sachs last week in an attempt to recover billions of dollars in bonuses and other compensation being awarded for 2009, despite the banking giant having accepted government bailout funds.
According to the Central Laborers’ Pension Fund’s suit filed Thursday in New York’s Supreme Court, the fund bought Goldman Sachs shares in January of last year. The suit alleges that by September 25, Goldman had set aside nearly $17 billion for employee compensation and might distribute more than $22 billion for the year.
The suit says that such sums, and Goldman’s practice of continuing to pay out nearly 50% of net revenue as compensation, show “scant regard” for the interests of shareholders, according to Reuters.
Goldman Sachs had required a $10 billion injection from the federal government’s Troubled Asset Relief Program and received $13 billion from insurer AIG after the government bailed it out. In June of last year, the New York-based bank repaid the TARP money.
The suit mirrors a trend of pension funds suing financial institutions, coming shortly after a Virgin Islands pension fund sued Morgan Stanley over CDO sales.
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