NEW YORK (Reuters) -A U.S. judge on Wednesday said he was ready to approve Rio Tinto's agreement to pay $138.75 million to settle a lawsuit that accused the Anglo-Australian mining giant of defrauding investors by concealing problems with its $7 billion underground expansion of the Oyu Tolgoi copper and gold mine in Mongolia.

Rio Tinto had reached a preliminary settlement with shareholders of the former Montreal-based Turquoise Hill Resources in June, pending approval from Manhattan-based U.S. District Judge Lewis Liman.  

Liman at a hearing on Wednesday said he was ready to approve the settlement, but did not sign off on it yet because he was waiting for the shareholders' lawyers to inform him of what they planned to do with any funds left after initial distributions.