The Wall Street Journal has reported that three Louisiana public pension funds want to withdraw the $100 million they invested in a New York hedge fund after the fund responded to $32 million in withdrawal requests with promissory notes instead of cash.
The Firefighters Retirement System of Louisiana, the Municipal Employees’ Retirement System of Louisiana and the New Orleans Firefighters’ Pension and Relief Fund say the total owed them, including profits, is at least $143 million, according to the Journal story. The paper used fund documents and interviews with a fund official and a consultant to the funds to arrive at the figure.
The pension funds invested with Fletcher Asset Management after being guaranteed an annual return of 12 percent. State legislators have asked auditors to review the investment.
State government does not guarantee any of the pension plans for firefighters, law enforcement, prosecutors and other employees of municipal and parish governments. The employees and the government employers must cover the losses.