(Bloomberg) -- Moody’s Investors Service Inc. agreed to pay $130 million to settle claims by the California Public Employee Retirement System over allegedly inflated ratings on residential-mortgage bond deals.
The largest U.S. state pension fund’s accord with Moody’s means the company averts a trial over the securities that was to begin in May.
The settlement follows the related February 2015 announcement that McGraw Hill Financial Inc.’s Standard & Poor’s paid $125 million to settle claims by CalPERS over grades on subprime mortgages during the run-up to the 2008 financial crisis. With Tuesday’s announcement, ratings companies have paid CalPERS $255 million to resolve such claims, the retirement system said.
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