TIAA Can’t Escape $50M Lawsuit Over Retirement Plan Loans

A proposed class action accusing TIAA of taking improper cuts from the loan repayments workers make to their retirement plans is moving forward.

The retirement plan service provider may have to turn over the money it kept from these loans—allegedly more than $50 million per year—under a theory of disgorgement, a federal judge ruled March 28. TIAA was credibly accused of wrongly generating profits off retirement plan assets that it obtained through transactions that violated federal benefits law, Judge J. Paul Oetken of the U.S. District Court for the Southern District of New York said.

However, Oetken dismissed all claims ...