SunTrust Settles Long-Running Suit Over Affiliated 401(k) Funds

SunTrust Banks Inc. has reached a settlement with about 30,000 current and former employees who challenged the bank-affiliated funds in their 401(k) plan, the parties told a federal judge in Atlanta on Friday.

The long-running dispute settled following a mediation session on Jan. 7, one day after the case was scheduled to go to trial. The parties say they expect to file formal settlement paperwork in mid-March.

The class action, first filed in 2011, accuses SunTrust of filling its employees’ 401(k) plan with affiliated mutual funds that paid fees to a bank subsidiary, despite the existence of cheaper, better-performing funds ...