Investment Lawsuits Stack Up

All allege a widespread pattern of corruption and behind-the-scenes political paybacks to direct state investments to selected financial firms – in particular firms that hired Marc Correra as a so-called “finder” or third party marketer.

♦ The first two cases were filed in 2009 by former ERB Chief Investment Officer Frank Foy under the state’s Fraud Against Taxpayers statute.

Both of Foy’s cases are tied up on appeal. He alleges widespread corruption by state officials, consulting firms and financial firms in billions of dollars of investments made by the State Investment Council and the teachers’ pension fund. The partial transcripts were filed as additional evidence to keep Attorney General Gary King from dismissing parts of Foy’s lawsuits.

♦ The State Investment Council filed a civil lawsuit last year against Aldus Equity and others and was joined by Attorney General Gary King who initially gave Foy the go-ahead to file his lawsuits..

King has since changed his mind and moved to dismiss large portions of Foy’s cases, in favor of a lawsuit filed on behalf of the State Investment Council against some of the same defendants named in the Foy lawsuits.

Foy and his attorney Victor Marshall are seeking to have King removed from the decision-making process in the cases because of alleged conflicts of interest.

A state judge recently allowed Foy to intervene in the State Investment Council case.

♦ The Educational Retirement Board filed a civil lawsuit against Aldus Equity Advisors alleging corruption in the selection of private equity investments. The teachers pension fund is represented by Albuquerque attorney Joseph Goldberg.

♦ Most recently, former chairman of the Educational Retirement Board, Bruce Malott, filed a lawsuit against Aldus Equity Advisers, and some of the same defendants named in the other four lawsuits claiming fraud, racketeering and breach of fiduciary duty among other civil claims.

There has been a federal grand jury investigation, but its status is unclear. The U.S. Attorney’s Office has had no comment.
— This article appeared on page A6 of the Albuquerque Journal