Perdido 03

Perdido 03

Monday, March 16, 2015

NYC Employees Retirement System Nixes Recommendation To Invest In Pro-Charter Joel Greenblatt's Hedge Fund

From the NY Post:

In a rare move, the board that oversees the city’s retirement fund for civil servants killed a proposal to invest in a high-yield hedge fund — run by one of the city’s biggest investors in charter schools, sources told The Post.

The New York City Employees’ Retirement System nixed a recommendation from the comptroller’s office to sink a portion of its $54 billion pension fund into Gotham Asset Management, which is run by Success Academies co-founder Joel Greenblatt.

The charter network is overseen by Eva Moskowitz, a long-time foe of Mayor de Blasio.

The 11-member board is stacked with reps who are allied with the anti-charter teachers’ union — including appointees from de Blasio, Borough Presidents Eric Adams and Ruben Diaz Jr. and leaders of three major city unions.

Stringer's office recommended the investment into the hedge fund:

The Comptroller’s Bureau of Asset Management referred Greenblatt’s hedge fund to NYCERS for consideration as a potential investment last month, but a spokesman for Comptroller Scott Stringer declined to say how it learned of the fund.

“As the investment adviser to the New York City Pension Funds, the Bureau of Asset Management recommends investments based strictly on their merits,” said Stringer spokesman Eric Sumberg.

One of the merits from my perspective is NOT to invest in a hedge fund run by a guy out to destroy public schools.

Apparently that's NOT one of the merits from Stringer's perspective


  1. A rare sliver of positive light in an otherwise miserable world of education in NYC. (Hey, I will take any good news these days)

  2. Thinking about this a bit as a former Scott Stringer appointee to both the Panel for Educational Policy and one of the City's pensions (BERS for non-pedagogical staff), I would say the system worked the way it should. The Comptroller's investment staff is supposed to be free from any ideological or political considerations. So they can put forward investments based on the expected return to the fund. The trustees have a fiduciary duty to act in the interest of the members as custodians of their retirement funds. I think the trustees can make an argument against the investment based on their fiduciary role alone and not on politics. They can simply assert that investment funds for public union employees and retirees should not be placed under management of someone who has been actively trying to undermine those unions because he cannot be trusted to manage the funds professionally and objectively. But I think the trustees need to do that, not the Comptroller.

    1. I understand your point, Patrick, and I think it's a fair one you make.