IN State Treasurer Says Pension Funds "Ripped Off" by Chrysler Bankruptcy

May 26, 2009 (PLANSPONSOR.com) - State Treasurer Richard Mourdock says the state cannot allow its "retired police officers and teachers to be ripped off by the federal government."

Speaking about the filing of an objection with the bankruptcy court handling the Chrysler LLC proceedings on behalf of the Indiana State Police Pension Trust, Indiana State Teachers' Retirement Fund and the Major Moves Construction Fund, Mourdock says the proposed restructuring seeks to pay billions of dollars to unsecured Chrysler creditors, while paying secured creditors only 29 cents on the dollar, according to The (Munster) Times.

The news report said Associate Professor of Finance Matt Will says Chrysler's plan "disrupts 100 years of bankruptcy law." He added that Indiana stands to lose $30 million in investments under the bankruptcy plan.

Last week a U.S. Bankruptcy Court judge turned away an attempt by the pension funds to block the sale of Chrysler assets (see Indiana Pension Plans Lose Shot at Blocking Chrysler Asset Sale ).

Rebecca Moore
editors@plansponsor.com