Administration April 5, 2004

Maine Retirement System Files WorldCom Suit

May 16, 2003 (PLANSPONSOR.com) - Add another one to the ever-expanding list of state retirement systems suing accounting firms over investments in WorldCom.
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The latest entrant into the sweepstakes is the $6-billion Maine State Retirement System, which filed a lawsuit in Kennebec County Superior Court alleging 16 accounting firms and banks misled state officials about the WorldCom investments.   This led to losses by state pension funds of approximately $38 million when the value of WorldCom bonds collapsed, according to a news release. 

“There is a loss here, and we believe that the responsibility for the loss can be attributed to the defendant accountants and underwriters,” Kay Evans, the retirement system’s executive director, said.

Among the defendants listed in the lawsuit are:

  • Citigroup
  • Salomon Smith Barney
  • J.P. Morgan Securities
  • Arthur Andersen.

Similar suits have been filed in recent months by various state pension funds.   Among them the Board of Trustees of the Tennessee Consolidated Retirement System (TCRS) (See  Tennessee Fund Files WorldCom Suit ), the University of California  (See UC Seeks Home Court Advantage in WorldCom Suit ), the state of Ohio (See  Ohio Will Stay Close to Home With Enron, WorldCom Claims ), the state of Alaska (See  Alaska Sues Finance Firms Over WorldCom Losses ) as well as pension systems in California, Illinois, West Virginia, and Alabama.

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