HARRISBURG, Pa. - Keystone Financial Inc. said Wednesday that it would pay $30 million to settle a class action brought by 43 school districts in Pennsylvania.The districts sued a subsidiary of the $7 billion-asset banking company, Mid-State Bank, in 1997 to recover investment losses. They alleged that the bank should have known the school districts' investment adviser, Devon Capital Management, had mishandled the investment of school district funds.

At the time, Mid-State was providing custodial services to Devon Capital. Devon's principal, John Gardner Black, has since pleaded innocent to134 counts, including fraud, and is awaiting trial in federal court.

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