RI Loses Money on Point Judith Investment, Raimondo Continues to Make Money
Thursday, April 28, 2016
"Gina Raimondo redefines venture capital 'success.' If doing well for yourself is the definition of success, then Raimondo meets and exceeds the benchmark," said former SEC lawyer and Forbes columnist Edward Siedle, who penned a column under the same verbiage on Wednesday for Forbes.
"As of September 30, the fund performance was .3% positive, which is dismal. I knew we were at the critical moment it would slip into the negative," said Siedle. "That proved correct with these latest numbers released."
About the Fund
The actual fund named "Point Judith Venture Fund II" raised $74,910,000 in 2006 according to SEC documents. Raimondo owns some substantial interest and continues to derive income from the fund. The State of Rhode Island invested $5 million in 2006, according to State Investment Commission.
According to Rhode Island Financial disclosure forms, Raimondo continues to have ownership in the fund and earns her portion of the management fee. And according to a report released this week by the Rhode Island State Investment Commission, the fund's internal rate of return as of December 31, 2015 is -1.1%.
"Is she a successful venture capitalist? No," said Siedle. "Had Rhode Island invested that money in the stock market during that time, they would have gotten close to 7% T-bills would have even been 1.2%."
Related Slideshow: RI Public Pension Reform: Wall Street’s License To Steal
See the key findings from Forbes' columnist Edward Siedle, who unveiled his investigative report into the RI pension system, "License to Steal," in October 2013.
"The Employee Retirement System of Rhode Island has secretly agreed to permit hedge fund managers to keep the state pension in the dark regarding how its assets are being invested; to grant mystery hedge fund investors a license to steal, or profit at its expense using inside information; and to engage in potentially illegal nondisclosure practices," said Siedle.
Treasurer’s Lack of Transparency
So-Called Pension Reform Scheme Permanently Reduces Benefits To Retirees
"Whether retirees receive any COLA will depend upon both ERSRI’s funding level and the Fund’s actual investment returns—both of which are volatile, unpredictable and subject to manipulation by elected officials and others. The manipulation of both of these key goalposts has already begun. "
SEC Should Investigate ERSRI’s Failure to Disclose Skyrocketing Investment Expenses
Lose-Lose: Alternative Investments Both Reduce Returns and Increase Risk
ERSRI Agrees To Be Kept In The Dark, Grants Mystery Investors Licenses to Steal and Consents To Potential Nondisclosure Illegalities
Heightened Risks Related To Hedge Fund Offshore Regulation And Custody
SEC Should Investigate Questions Surrounding ERSRI’s Point Judith Venture Investment
Rhode Island Ethics Commission Opinion And “Blind Trust” Fail to Address Conflicts Regarding Point Judith Investment
SEC Should Investigate ERSRI Investment Consultant Conflicts, Payments From Money Managers
“Pay To Play” Placement Agent Abuses at ERSRI
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