Attorney General Becerra Announces $7 Million Settlement Against Multinational Bank HSBC for Overcharging CalPERS on Foreign Exchange Transactions

Thursday, September 24, 2020
Contact: (916) 210-6000,

SACRAMENTO – California Attorney General Xavier Becerra announced a $7 million settlement involving multinational bank and financial services company HSBC for overcharging the California Public Employees Retirement System (CalPERS) in foreign currency trading. 

“When you retire from public service, every dollar of your pension counts,” said Attorney General Becerra. “We’re holding HSBC accountable for cheating California state pensioners out of their money. No doubt $7 million counts a lot.”

The settlement resolves allegations that HSBC violated the California False Claims Act, which makes it unlawful to submit a false claim or false statement in order to obtain money from the state. An investigation by the California Department of Justice (DOJ) showed a pattern of HSBC’s relatively high charges to CalPERS during 2008 and 2009 in Euro and British pound transactions. The DOJ concluded that markups resulted in millions in losses to the pension fund, which provides for the retirement of firefighters, police, and other state employees.

This case continues Attorney General Becerra’s work stopping deceptive practices by major corporations. On July 13, he announced a $1 million settlement against the owner and operator of Legacy Post-Acute Rehabilitation Center, a skilled nursing facility in San Bernardino that was allegedly wrongfully billing Medi-Cal for patients needing a heightened level of skilled nursing care. On April 25, 2019, Attorney General Becerra announced a $150 million settlement against Morgan Stanley, an American multinational investment bank, for misleading investors including CalPERS and the California State Teachers Retirement System (CalSTRS). On December 17, 2019, he announced an $800,000 settlement against Infosys, an India-based business consulting, information and outsourcing services company and its subsidiary, resolving allegations that the company misclassified workers in order to lower employee pay and avoid California payroll taxes. On June 13, 2019, he announced a lawsuit against Texas-based ClubCorp Inc., owner-operator of more than 200 private golf and country clubs nationwide, for failing to repay more than $10 million owed to its more than 9,000 California members. In January 2018, Attorney General Becerra announced a $102 million settlement with BP Energy and its affiliates over allegations that it intentionally overcharged the State of California for natural gas that the state purchased between 2003 and 2012. And on December 2017, Attorney General Becerra announced a $125 million settlement with the Royal Bank of Scotland (RBS), an international financial conglomerate, over misrepresentations about residential mortgage-backed securities sold to CalPERS and CalSTRS. 

A copy of the settlement is available here.

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