BNY Mellon has reportedly agreed to settle a lawsuit related to Sigma Finance, a “structured investment vehicle” fund, or “SIV,” that collapsed during the financial crisis in October 2008. The $280 million settlement resolves claims that the bank imprudently invested and ultimately lost customer money in Sigma Finance. The plaintiffs alleged that BNY Mellon’s investments of cash collateral in the bank’s securities lending program into medium-term debt issued by Sigma Finance was not done “conservatively and prudently.” SIVs such as Sigma Finance suffered heavily during the financial crisis as a result of their investments in high-yield repackaged debt. Sigma Finance was reportedly one of the last of such SIVs created prior to the financial crisis in 2008. JPMorgan Chase agreed to resolve a similar lawsuit for $150 million earlier this year. (“BNY Mellon pays to end $280m Sigma case,” Financial Times, July 6, 2012).