Boston.com – The city’s Retirement Board is monitoring a lawsuit filed against an Asian hedge fund that went under, hoping it can recoup some of its own money invested in the fund.
The Brockton Contributory Retirement System three years ago wrote down a $3.4 million investment to $1, making it one of several municipal retirement systems that lost millions in the First America Asia Fund I LLC. Municipal retirement systems in Haverhill, Natick, and Salem also lost investments in the fund, which invested in the Chinese market and at one point was valued at $33 million.
The New Orleans Firefighters Pension Board, the largest single shareholder, is suing the fund, and investors that lost out, including Brockton, are watching closely to see if a favorable verdict or any information introduced as evidence could help them recoup their own losses.
"We could benefit if the lawsuit comes through," said William R. Farmer, chairman of the Brockton Retirement Board and executive director of the Plymouth County Retirement System. The county system had no involvement with the hedge fund, he said.
Even with the $3.4 million loss, Farmer said, the retirement system has seen significant yearly returns since the board started making venture capital investments in 1995, making it one of the more profitable municipal systems in the state.
