Massachusetts Pension Fund Under Fire

October 28, 2002 ( - Massachusetts' $25 billion state pension fund, Pension Reserves Investment Trust (PRIT), has refused to comply with an order to disclose its venture capital investment performance.

The September 16 th order from the state supervisor of public records to turn over venture capital performance, requested by businessman Mark O’Hare, would jeopardized future venture capital investments, fears PRIT.

PRIT claims “they were threatened with litigation by the investment companies they do business with” and citied an exemption to public records law because of a fiduciary duty to the state’s pensioners to keep its confidentiality agreement.

Venture capital funds require such confidentiality agreements because of the nature of their investments, performance and complicated returns.   These returns can be difficult to interpret by the individual investor and could easily be misrepresented and incorrectly reported, according to supporters.  

However the state says the fund fails to meet part of the exemption and has continued its suit.  

Similar suits have recently occurred in Texas and California.   The Texas Attorney General ruled the University of Texas’ pension fund venture capital information had to be revealed.   The San Jose Mercury News suit against CalPERS is still pending.  

Massachusetts’ suit is now with the state Attorney General Thomas Reily.