M&T Bank to Pay $21 Million in Suit Over Affiliated 401(k) Funds

M&T Bank Corp. will pay about $20.9 million to settle a lawsuit challenging the affiliated mutual funds in the 401(k) plan covering its employees, the proposed class of 21,000 employees told a federal judge in Buffalo, N.Y.

The deal, announced Dec. 26, requires M&T to have the disputed funds reviewed by an independent investment adviser. M&T also agreed to seek out a new record keeper to provide administrative services to the plan, which holds about $2.5 billion in retirement assets.

The lawsuit accuses M&T of forcing its employees’ retirement savings into affiliated mutual funds that earned fees for the company. ...