New Mexico Union Sues Austin Capital
June 25, 2009
The National Education Association of New Mexico has filed a lawsuit against Austin Capital Management (ACM) on behalf of the state’s Educational Retirement Board (ERB) and State Investment Council (SIC).
According to Austin-American Statesmen, the lawsuit was filed in state district court in Santa Fe and alleges that ACM failed to perform due diligence on its investments with Madoff Securities. As a result, the ERB and SIC plans lost as much as $25 million.
ACM has felt the heat from plan sponsors due to investment losses suffered from Madoff. In February, the Massachusetts Pension Reserves Investment Management Board terminated the manager from a $130 million hedge fund portfolio. Likewise, that same month the New Mexico ERB decided to redeem the same amount from the firm from an absolute return fund for the same reason.
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