State Street Corporation Bank has been sued by the state of California over allegations that the Boston-based banking concern defrauded the state's two largest pension funds, California's attorney general Jerry Brown informed on Tuesday.

The suit, filed in a state Superior Court in Sacramento in 2008 and unsealed on Tuesday, contends that State Street illegally overcharged the California Public Employees' Retirement System, or Calpers, and the California State Teachers' Retirement System, or Calstrs, by $56.6 million by improperly executing foreign-currency trades since 2001.

While State Street denied any allegations, Mr. Brown said that the State Street Corporation Bank has breached its agreements with the $200 billion Calpers and the $130 billion Calstrs. The suit seeks more than $200 million in damages, calling it a "white-collar kind of rip-off".

The complaint also stated that State Street concealed the alleged scam by developing fake reports and failing to deliver time-stamp facts for the trades.

In State Street's defense, spokeswoman Hannah Grove said, "We categorically deny any allegations of wrongdoing and will defend ourselves against any litigation".

The State Street lawsuit has come as another trouble for Calpers which is nation's largest pension fund. Last week, the organization said that it was investigating "pay-to-play" concerns after it disclosed a former board member had garnered over $50 million in charges for making arrangements for investments.

A spokesperson for Mr. Brown told that the State Street suit isn't linked to those fears.