The Times-Picayune reports that the State Police Retirement System learned the day before Christmas that Union Bancaire Privee, a Swiss private bank, had deposited as much as $400,000 of its money with Ascot Partners, a $1.8 billion hedge fund invested almost entirely with Bernard L. Madoff Investment Securities. Madoff is being prosecuted for running a $50-billion Ponzi scheme.
The Ascot fund has collapsed, and it is unclear whether the retirement system will recoup any of its money, the newspaper said.
The New Orleans City Employees Retirement System had $400,000 invested with Union Bancaire Privee and Meridian Capital Partners, which each invested $175,000, and with Silver Creek, which invested about $50,000, in Madoff-related investments.
Jerry Davis, chairman of the New Orleans system’s board of trustees, said he is upset about the potential losses to Madoff, but is more concerned about the pension fund’s overall decline, according to the news report. After reaching an all-time high of $428 million in July of 2007, the fund has fallen in value to about $275 million.
Irwin Felps, executive director of the police retirement system , reported similar losses for the police retirement system, which at $330 million is worth about 21% less than it was last July.
The two funds’ Madoff losses are small compared to reports from other public pension systems hit by the scheme (see MOSERS Hit with $3.5M-Madoff Lossand CT Town with Madoff Losses Debates Pension Appointment ).