US - The State of Michigan is suing manufacturer Tyco International, its auditors and four former executives for over US$50m in losses to state pension funds.
The complaint alleges that Tyco, which manufactures a wide variety of products, from electric components to healthcare products, continually inflated its earnings and manipulated its books to hide excessive executive compensation.
In addition, it claimed Tyco misled its investors by implementing improper accounting practices, which they internally referred to as "financial engineering".
As a result, Tyco stock hit an all-time high in 2001. But Michigan pension funds lost more than $50m when a stream of financial disclosures sent Tyco stock plummeting.
Tyco's former chief executive, Dennis Kozlowski, and chief financial officer, Mark Swartz, were convicted in New York of grand larceny, falsification of business records, and conspiracy, and are currently serving lengthy federal prison sentences. A former director pled guilty to securities fraud.
State treasurer Robert J. Kleine said: "Nearly 600,000 participants and beneficiaries are depending on state pension funds to secure their retirement. We take our obligation to protect those funds very seriously."
SMRS, which invest on behalf of Michigan public school employees, state employees, police, and judges, holds combined assets of around $62bn.
Potential changes to accounting standards and increased pressure on companies to accelerate contributions could worsen FTSE 100 scheme funding by up to £100bn, according to Lane Clark and Peacock (LCP).
Smart Pension has taken on over 20,000 active members from the £20m Corpad Master Trust, following a strategic review by the ceding firm's trustees.
The Universities Superannuation Scheme (USS) allegedly obstructed a whistleblower as she tried to discover the true value of the deficit in its defined benefit (DB) section, according to reports.
The Cost Transparency Initiative (CTI) has launched a number of templates and guidance to help pension schemes deliver greater value for savers with enhanced disclosure of transaction cost information.