SunTrust Inks $29 Million Deal in 401(k) Suit Covering 30,000

SunTrust Banks Inc. will pay $29 million to end a long-running class action challenging the affiliated mutual funds in its 401(k) plan, according to a settlement motion filed in an Atlanta federal court.

The deal, announced Wednesday, ends a nine-year-old class action covering 30,000 participants in SunTrust’s 401(k) plan. SunTrust was accused of filling the plan with affiliated mutual funds that paid fees to a bank subsidiary, despite the existence of cheaper, better-performing funds from competitors.

This is one of the largest settlements signed by a financial company in a lawsuit over the affiliated funds in its 401(k) plan. Dozens ...