BALTIMORE -- Robert Edward Baker, a former trustee of the Eastmet 4049 Trust, was sentenced by a judge in U.S. District Court in Baltimore to 36 months in prison for embezzling pension funds and lying to the Pension Benefit Guaranty Corp., according to the U.S. Attorney's office in Baltimore.
The trustee for the plan for management group employees of Eastmet and Eastern Stainless Steel pleaded guilty in September to both offenses in a criminal case before Judge Marvin J. Garbis.
Mr. Baker's criminal conviction follows a March civil judgment in the same court in which he was ordered to pay the PBGC $300,000 in restitution and interest for the embezzled pension trust funds.
From 1988 to 1995, the Eastmet 4049 Trust received $210,617.88 in dividends and interest on stock it owned. Mr. Baker admitted he embezzled and converted for his own use $210,025.05 of the proceeds, according to the U.S. Attorney's office.
In 1997, the PBGC brought a civil suit against Mr. Baker on behalf of the trust. Mr. Baker admitted he committed perjury in the course of the PBGC civil suit.
The PBGC took over the Eastmet plan in 1987 when it was terminated following a corporate bankruptcy filing, according to a PBGC spokesman.
Taunton retirement system determines small-cap finalists
TAUNTON, Mass. -- The Taunton Contributory Retirement System picked Batterymarch Financial Management, Dreyfus Investment Advisors, Earnest Partners, Gabelli Asset Management and Daruma as finalists in its search for a manager to run a $7 million core domestic small-cap equities portfolio, said Paul J. Slivinski, executive secretary.
The system, with $107 million in assets, will interview finalists at its Feb. 16 board meeting. Fleet, the fund's current domestic small-cap manager, was on watch, but its performance has recovered and the board will decide whether it will hire one of the finalists to replace Fleet.
Segal Advisors assisted.
Judge approves settlement in Florida State action
TALLAHASSEE, Fla. -- The $93 billion Florida State Board of Administration said the settlement of the action it initiated against UCAR International Inc. has been approved in U.S. District Court for the District of Connecticut.
The action, in which the Florida pension fund acted as lead plaintiff, was brought on behalf of investors in UCAR from the date of the company's initial public offering in August 1995 through March 1998.
The action alleged violations of the federal securities law because of UCAR's failure to disclose the extent to which its growth, profit margins and earnings were the result of an illegal price-fixing conspiracy.
The court approved a payment of $40 million to the plaintiffs and the appointment of a new director with antitrust experience to UCAR's board of directors. Mary Cranston, chair of the law firm of Pillsbury, Madison & Sutro, has been appointed to the board as part of the settlement.
Tom Herndon, executive director of the Florida State Board, said Florida was pleased by the court's move and noted that providing for the appointment of a new director is a ground-breaking development in shareholder litigation.
Employees fund reduces emerging markets, small-cap
NASHVILLE, Tenn. -- The Nashville & Davidson County Metro Employees' Benefit Fund reduced its exposure to small-cap domestic and emerging market equities.
The $1.585 billion defined benefit plan revised its asset mix following an asset allocation study conducted in the second half of 1999. No managers have been terminated or hired, said Walter Messemer, investment manager.
The new asset mix is: 46% large-cap equity; 21% domestic fixed income; 14% international equity; 11% small-cap equity; 5% emerging markets equity; and 3% alternatives.
Santos' conviction reversed; Chicago explores options
CHICAGO -- Chicago's Department of Law and the U.S. Attorney's office are both looking into their legal options following the reversal of former City Treasurer Miriam Santos' extortion conviction.
Judge Richard Posner reversed Ms. Santos' federal mail fraud and extortion convictions Jan. 19. She had been convicted of extorting campaign contributions from banks and securities firms that invest city treasurer's office funds.
Under state statute, Ms. Santos is eligible to regain her position as city treasurer, with back pay and benefits. The city's law department is seeking case-setting precedents, because this situation has never happened before, said Jennifer Hoyle, spokeswoman for the Chicago Department of Law. The U.S. attorney's office has several weeks to decide whether to petition for a rehearing or to allow the case to be retried.
Texas Growth invests in Internet company
AUSTIN -- The Texas Growth Fund invested $2.5 million in FundsXpress, a provider of Internet banking and other financial services, as part of a $40 million private financing round.
The $577 million Growth Fund is equity oriented and invests money from state public pension funds and endowments in companies with operations in Texas. Investors in the fund include the Employees' Retirement System of Texas, the Teacher Retirement System of Texas, the San Antonio Fire & Police Pension Fund and the Permanent University Fund, all in Austin.
Barclays adds new service for medium-sized plans
SAN FRANCISCO -- Barclays Global Investors created an investment service for medium-sized defined benefit plans with assets between $100 million and $500 million.
The ClientConnect 2000 program, headed by Kathleen Powers Dunlap, managing director, offers clients access to more than 20 investment strategies, using its own institutional commingled funds. Clients can select funds from within a series of index, enhanced index and tactical asset allocation options.
Clients can obtain around-the-clock account information via the web, including performance reports, trust statements and current and historical unit values. The Internet services will be further enhanced later this year to give clients transactional capabilities online and to view portfolios by sectors and holdings.
CME adds days and places to its futures listings
CHICAGO -- Chicago Mercantile Exchange added six cities and cooling degree day indexes to its weather futures contract listings beginning Jan. 30.
Beginning with the Sunday evening GLOBEX2 electronic trading session, the CME listed both heating degree day and cooling degree day indexes for 10 cities, adding Dallas; Des Moines, Iowa; Las Vegas; Philadelphia; Portland, Ore.; and Tucson, Ariz., to the previous HDD listings for Atlanta, Chicago, Cincinnati and New York.
In addition, 12 monthly contract expirations are now offered, covering the period from February through January 2001.
Tremont Advisers opens new fund-of-funds series
RYE, N.Y. -- Tremont Advisers is starting a new family of proprietary hedge funds that will be offered as funds of funds under the "America Masters Series" name.
The series will be sold through financial intermediaries such as registered investment advisers, broker/ dealers and financial planners, said Robert Schulman, president.
The first offering will be a market-neutral fund of funds, and the second offering "will be more aggressive," according to Mr. Schulman.
The new funds will be marketed both to high-net-worth individuals and institutional investors.
Bill Archer means business when it comes to investments
WASHINGTON -- House Ways and Means Committee Chairman Bill Archer, R-Texas, is promising a quick start to unfinished business from the first session of the 106th Congress. In a letter to other committee members, Mr. Archer said he intends to focus on ways to promote personal savings and investments as part of a bigger package of tax cuts. President Clinton vetoed a $792 billion Republican tax package last fall.
Texas county system selects new software
AUSTIN, Texas -- The Texas County & District Retirement System is implementing the QED Information System's IMS-2000 portfolio management and investment accounting software. The $7.1 billion pension fund was using an internally developed system, said Paul Williams, investment officer.
Schwab forms alliances for online advice
SAN FRANCISCO -- Charles Schwab Retirement Plan Services has formed alliances with both Financial Engines and mPower/401(k) Forum to include online investment advice through Schwab's bundled 401(k) plan offering. Personalized recommendations on investing in the mutual funds in participants' 401(k) plans will be available through links on schwabplan.com, Schwab's 401(k) website. Plan sponsors will pay advice-givers directly.
BISYS upgrades record-keeping system
LITTLE FALLS, N.J. -- BISYS Investment Services Group, a third-party administrator for small and midsize 401(k) plans, completed an upgrade of its 401(k) plan record-keeping and processing system. The system will provide plan sponsors with enhanced Internet access, increased flexibility and capacity.
The new features include expanded fund choices, detailed data reporting and Internet participant account access. BISYS executives also intend to add a dedicated plan sponsor website early this year.
Separately, Bisys Fund Services, a sister company, released an online version of its FundLink mutual fund compliance and fund accounting system. Both domestic and offshore mutual fund clients will have real-time, around-the-clock access to portfolio information such as holdings, financial statements and securities pricing information and compliance test results.
Gabelli opens offshore fund
RYE, N.Y. -- Gabelli Securities International is offering a new offshore hedge fund to institutional and high-net-worth investors. The euro-denominated Gabelli European Partners will follow a value approach, seeking investment opportunities in Europe. Initial capitalization is $200 million to $300 million