The Washington Post reports that the investigation found that Quads Trust Co. had delayed making investments requested by account holders, had failed to repay loans on time and had tax liens filed against it by the state of Maryland, schools officials said. The investigation started after a complaint to the school system.
“There’s no accusation of mismanagement or missing money, but the concern after finding all these things out is that this is not a suitable financial custodian anymore,” said Patrick Clancy, an attorney for Montgomery schools, in the Post report.
School officials notified Quads that they would terminate its services by May 22, but according to the school system’s complaint, Quads refused to allow the school system to transfer the teachers’ accounts as a whole to another company, Lincoln Investment Planning. The school board then filed a lawsuit alleging breach of contract by Quads.
A Web site to tell teachers how to redirect their payroll deductions and transfer their accounts to another company while the lawsuit proceeds, has been established.
Quads has managed investments for the Montgomery teachers for more than 10 years. According to the Post, company officials did not return calls requesting comment.