Category Archives: Investments

Major state contractor fined $500K for violating SEC rules

Source: Steve Miller, Texas Monitor, July 12, 2018

A key state contractor has been fined $500,000 by the Securities and Exchange Commission for alleged political contributions to candidates in the governor and attorney generals’ races in 2013 and 2014. Employees of Houston-based EnCap violated rules that govern donations from financial firms to candidates who, if elected, would play a role in their selection to invest public money. According to a cease-and-desist order from the SEC, the contributions include $25,000 to a gubernatorial candidate in September 2013 and a total of $60,000 to an attorney general candidate. The offending contributions were made between September 2013 and May 2014, according to the SEC. EnCap was also named for violating rules in Indiana and Wisconsin. … The SEC order contends that several state retirement systems, including the University of Texas, the Teachers Retirement System, and the Texas County and District Retirement System, collectively invested $2.27 billion in funds advised by EnCap. …

State to get $1.5 million in EB-5 settlements

Source: Jonathan Ellis, Argus Leader, March 15, 2017

The state of South Dakota on Tuesday announced the settlements of two civil lawsuits against a company that managed the federal EB-5 Immigrant Investor Program on behalf of the state. The settlements with the South Dakota Regional Center will result in the company repaying approximately $1.5 million to the state. … The lawsuits stem from the scandal over management of the EB-5 program in South Dakota. The federal EB-5 program allows wealthy foreign investors to acquire green cards to the United States for investing $500,000 in qualifying projects that increase economic development in rural or impoverished areas of the United States. … Under former Gov. Mike Rounds, the EB-5 program was run through the Department of Tourism and State Development by a state employee named Joop Bollen. In 2009, Bollen quit his job with the state and signed a contract with the state to manage EB-5 projects through his company, SDRC. In 2011, the former head of Tourism and State Development, Richard Benda, went to work for Bollen and SDRC. In the spring of 2013, state officials learned that the U.S. Department of Justice was investigating the administration of the EB-5 program in South Dakota. Benda committed suicide that October as state authorities moved to indict him for directing $550,000 in state funds to SDRC. … Last month, Bollen pleaded guilty to one felony count for diverting money from an account to protect the state from potential liability claims. … Tuesday’s settlements don’t end litigation surrounding the EB-5 program. …

University of California drops prison investments amid student demands

Source: Curtis Skinner, Reuters, December 18, 2016

The University of California system said on Friday it will drop its roughly $30 million worth of investments in private prison companies following demands from a black student group. The decision comes amid a wave of student protests against racism at college campuses across the country as well as the Black Lives Matter civil rights movement against the U.S. criminal justice system, which disproportionately impacts black people. … Klein said the amount invested was less than $30 million, a tiny fraction of the UC system’s $100 billion investment portfolio. Klein said she did not know exactly which private prison companies the system held shares in or exactly how much money was invested. The coalition, a California-wide student group, said the UC system had $25 million invested in Corrections Corporation of America and The Geo Group.

State investment chief considers privatizing investment pool

Source: By Paige St. John, Tallahassee Democrat (FL), December 19, 2007

As an audit committee attempts to unravel how Florida became so heavily invested in subprime-tainted securities, the state’s new investment chief is considering leaving such future decisions to professionals.

Florida already seeks to privatize management of what remains of its $12 billion local government investment pool, after revelations it contained defaulted securities caused its near collapse.

……… Private management has already come at a cost — the fund’s new interim managers charge up to $39 for every $10,000 invested, compared to $1.50 formerly charged by the state.