Bruce Malott, former chairman of the $9.5 billion New Mexico Educational Retirement Board, Santa Fe, filed a whistle-blower lawsuit against a long list of defendants, including Aldus Management Co., Aldus Equity LLC and two other Aldus subsidiaries; and Deutsche Bank Americas Holding Corp., according to a copy of the complaint.
The complaint, brought in the New Mexico District Court, First Judicial District, Santa Fe, accuses the defendants of racketeering, fraud and breach of fiduciary duty. Mr. Malott seeks an unspecified amount of actual and punitive damages.
The complaint contends that the close to 40 defendants “played a variety of roles in a complex web of corruption that spanned the United States from coast to coast, including New Mexico, and resulted in illegal payoffs totaling far in excess” of $100 million. The complaint alleges that the defendants' alleged scheme against the New Mexico Educational Board began in 2006.
Mr. Malott also alleges that the defendants' “criminal misconduct” resulted in $22 million in allegedly illegal payoffs in New Mexico.
Many of the same defendants are being sued by Frank Foy, former chief investment officer of the New Mexico Educational Retirement Board, and some also are named in a lawsuit brought by the $14.7 billion New Mexico State Investment Council, Santa Fe.
Mr. Malott resigned from the board in September; Mr. Foy left in 2008.
“We believe the suit is without merit, and we will vigorously defend ourselves,” according to a written Deutsche Bank statement.
Aldus executives could not be reached by press time.