The US Labour Department suit alleges misuse of assets for personal gain
The US Department of Labour has sued Chicago-based AA Capital Partners and its executives for improperly causing more than $25m in losses for five Michigan pension funds.
The department's suit alleges that AA Capital Partners’ co-owner and president along with the CFO misused plan assets and charged the plans excessive fees on investments.
The misused monies were allegedly used to pay for the operating expenses of the firm as well as renovations to a horse farm and a strip club.
“The misused monies were allegedly used to pay for the operating expenses of the firm as well as renovations to a horse farm and a strip club.
Secretary of Labour Elaine Chao, said: "This case involves gross abuse of the trust that workers and their families placed in the management of these pension funds. We are seeking full restitution to the pension plans, including the illegal profits that the defendants realized at the expense of workers and their families."
The suit seeks to restore all losses.
The pension plans covered more than 60,000 participants with total assets of approximately $3.1bn.
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