Aon Settles for $15 Million with Pennsylvania Teachers in Landmark Agreement

A unit of Aon Plc has reached a settlement in a class-action lawsuit that claimed calculation errors and inadequate investment advice led Pennsylvania public school teachers to contribute millions more to their pension fund than necessary.

The settlement, amounting to $15 million, was agreed upon by Aon Investments USA, as detailed in a recent filing in federal court in Philadelphia. This marks the third settlement involving teachers and advisers related to the $80 billion Pennsylvania Public School Employees’ Retirement System, the largest public pension fund in the state.

Previously, asset managers Hamilton Lane and Portfolio Advisors also settled allegations in this case. They were accused of recommending unsuitable and costly private equity and private credit investments, further complicating the financial landscape for the teachers’ pension fund.

However, the settlement is still pending court approval, as noted by Gerard Mantese, a lawyer representing the plaintiffs. An Aon spokesperson has opted not to comment on the matter.

The lawsuit alleges that Aon advised the pension fund to invest in inappropriate hedge funds with high fees, resulting in substantial financial losses. Additionally, Aon reportedly relied on other financial advisers to calculate returns but failed to verify these returns or disclose excessive fees, according to the claims made in the lawsuit.

In a related matter, Aon previously settled allegations from the US Securities and Exchange Commission (SEC) regarding miscalculations of the teachers’ pension returns. In 2024, Aon paid a $1 million penalty without admitting or denying the SEC’s findings, which highlighted significant discrepancies in historical returns.

These miscalculations have caused considerable turmoil within the Pennsylvania pension system, leading to the resignation of both the chief investment officer and the executive director. In 2024, Aon also agreed to a $7 million settlement with the pension fund as part of the ongoing fallout from these issues.

Copyright 2026 Bloomberg.

Topics
Aon
Pennsylvania

A unit of Aon Plc has reached a settlement in a class-action lawsuit that claimed calculation errors and inadequate investment advice led Pennsylvania public school teachers to contribute millions more to their pension fund than necessary.

The settlement, amounting to $15 million, was agreed upon by Aon Investments USA, as detailed in a recent filing in federal court in Philadelphia. This marks the third settlement involving teachers and advisers related to the $80 billion Pennsylvania Public School Employees’ Retirement System, the largest public pension fund in the state.

Previously, asset managers Hamilton Lane and Portfolio Advisors also settled allegations in this case. They were accused of recommending unsuitable and costly private equity and private credit investments, further complicating the financial landscape for the teachers’ pension fund.

However, the settlement is still pending court approval, as noted by Gerard Mantese, a lawyer representing the plaintiffs. An Aon spokesperson has opted not to comment on the matter.

The lawsuit alleges that Aon advised the pension fund to invest in inappropriate hedge funds with high fees, resulting in substantial financial losses. Additionally, Aon reportedly relied on other financial advisers to calculate returns but failed to verify these returns or disclose excessive fees, according to the claims made in the lawsuit.

In a related matter, Aon previously settled allegations from the US Securities and Exchange Commission (SEC) regarding miscalculations of the teachers’ pension returns. In 2024, Aon paid a $1 million penalty without admitting or denying the SEC’s findings, which highlighted significant discrepancies in historical returns.

These miscalculations have caused considerable turmoil within the Pennsylvania pension system, leading to the resignation of both the chief investment officer and the executive director. In 2024, Aon also agreed to a $7 million settlement with the pension fund as part of the ongoing fallout from these issues.

Copyright 2026 Bloomberg.

Topics
Aon
Pennsylvania