Welcome back to a good thing -- last week we did a couple of shows. Rather -- centers habits. Federal -- judge in Detroit or or answering that Detroit bankruptcy. Basically said to be. State. Constitutional. Lawyers. That the state constitution. Did not. Our. And there were numerous stories about Chicago. -- and of Florida and many many more than it could be affected by this rule. And it led -- with pensions and retirement systems. Over the weekend every bit Bjorn. Had fallen. As reportedly he Condit three Louisiana retirement system. Out of a hundred million dollars in firefighters in municipal employees' retirement system. Better understand listen to what this means for our apartment of -- minister workers if anything -- Phil price with the news. -- over the three pro and she would price cordon in Baton Rouge feel appreciated the call. Don't all right -- I'm gonna happen holiday season. Or are these reports correct is deserted look like you've retirement system have been conned out of -- hundred million dollars. Tell -- that they are correct. That the trustees' report that you were referring to was prepared. All the trustee for the bankruptcy in the southern district of New York. You know which that was built upon that. That a number of these funds and directly invested. And we had been. Didn't win that maybe the pond or misappropriated. And won the report came out on open reported. It was clear that brought more than forty million dollar of the bonds that were taken problem. The Louisiana pageant -- for immediately paid out to certain organizers. Of football and just like somebody robbed a convenience store it's that clear and happened within thirty days of the town always you know on the money. We're we're union leader and look at when -- first person put to secure other. Everything I read to and they were guaranteed 12% -- returned. And mature a little more than tolerances and warned of tough and that it be too good to be true in the in this thing and that. Anything that -- 12%. Return opponent is suspect. And they invest with us. Well you know we're looking at a different point applicant back in 2030. Which would vote for the Lehman played yours and these private equity bonds -- top performing punch but the biggest. There were two real reason to -- Louisiana punched all potential good investment. Partial ball it was a proper at first and there war approximately eighty million dollars of equity funds that Wright junior tournament is. No court in -- so -- do. Page -- for other shareholders would get paid in their work. Eighty million dollars of investors. That they were actually used to it so. When it was explained to rule that they said okay you'll get major writer for car. Before anybody else gets played in -- worst mica says other investors to get paid until they got eight. A person ball -- very important thing and they did that placed the ball on. But all the reports and then the second thing news is that. This little blind pool and -- problem unusual feature -- what happens it is is that. -- certain investment funds the right to invest in the future. So when this particular case -- police you know upon it is like put together a hundred million dollars. And the bond work to invest it in certain investment in the future. Never did the right side that there will take the money and pay all their existing obligations. And that's an essence what happened here and two I would the primary organized it was -- -- gentleman by the label while Alphonse Fletcher. And then. -- -- Group lost a primary entity that provided the investment advice and should go group was the one that receive deported two million Dollar Financial benefits. And do do that retirement -- know that. Now they didn't know that they never do it at a time man you know obviously had they known that they would never indulged. And and that's what's you know on the most important thing is that such speculation on our part the report. By the trustee in the southern district has confirmed exactly the -- Over the weekend reports of your kid -- manager. Apparently. Content three -- general retirement systems of hundred million dollars. We have above bill profits with the scout -- for the three province with the approached Gordon and Baton Rouge. Bill or the going to be able to get this money back. Shop thanks so -- think they're gonna -- substantial recovery. Richard Davis who has the -- that's responsible for initiating actions. In the southern district of New York. He's a former war prosecutor. Richards about seventy years old and he's one of the most highly respected trustees'. In the New York City. And he's the one that prepared the report he did our job and we feel very call -- the his actions -- -- books. All suits that we have -- here and we you have done there's going to be a substantial copper. The retirement system. Attempted -- redeemed -- holding from Montgomery. March 2011. But there were offered processor and notes while what did they think they get the money back -- -- come problem. Look what look first thing that happened was that there was some a restated all of it -- grant more. And in approximately 2011. Grant -- one of the largest CPA firms. In the world. Rabat Estes financial statements. And admitted that it made an era during the time period a couple of weeks -- upon twelve making the investment. So what happened was wants this information came out them Louisiana. These Greek bonds took the steps took. Redeem a portion of it -- man. When they -- -- agreement in can't verses give them their money. All of a sudden they realize there were some potential problems America and outside CPA problem. Take a look at it and reconfirm what -- called socialism and over the the last two years expend a lot of times Bolton. In the Cayman Islands where the pond or operating out of the world -- New York attempting to get that money back. And the bull whatever happened to us that -- knew they were via. Financial services firm Gibson was to make up the gap of the returns were suppose what they're supposed ability. That's not quite adequate player or lecture was one that should go was. Stick coal company who investors like junior. To -- the company which core war are to make them money out of there accounts in the event at the -- were not met. But what is -- in the coming out based on the report out of those southern district it is is that. That -- took 42 million dollars of the money. Either to repay loans or to sell -- closely and counties. To lecture and slow the primary beneficiary. Altering it turns out based on. Report out of the southern district wants it. On the part of the lawsuit over presume. On the drill when you mentioned lecture -- Clinton issued this. He's Cortes is sitting pitchers official should know what there -- getting into. We told them higher risk offshore investments were laws have been tyrant best of the -- is -- Well it's true that altering memorandums that what it didn't say is that we're never two count to -- upon. -- and what happened here was they didn't like Kenya and best. With purple on its although they did was take the money in use it to -- -- their existing obligations. Well look at this live look that says you they knew and where you do it's they knew about. -- -- getting -- high Rezko assured harassment lawsuit being -- as -- as possible. If they danger of that new and -- they Camping World all the ball board. What would -- pension -- that that is handling people's retirement. Money. Investments -- that even mentions. The loss of the entire investment. -- -- A lot of good questions. But the answer to that is very simple all of the -- practices. The sight you're exactly that line which -- SEC -- Requires. Any type of bonds but there's gonna in best and probably equities. That how this language. Now. In this particular case where you make computer investment you -- on the track record about popped lecture which at that point good and you look at the professionals that were associated with the help -- lecture. In this particular occasion grant which was the second largest CPA clone in the world -- to -- go that was one of the biggest investment and -- -- -- in the world he had Skadden corpses the best -- parliament America. And so when these pension fund managers looked at this and you know. This is a pretty good group it would make an investment -- it and they have expertise ball beyond what we understand. And turned that time period in question you have low interest rates yet pension obligations had the big man. And so. The pond realized that they had to make more than one or 2% that they could make in the debt market in so but it had moved what's called alternative investment support all pension -- now public and private plunged. Are investing -- And -- -- -- alternative investments to define it went wrong what does. This is kind of like -- at a convenience store and somebody put a gun don't you'd never expected it would happen but there's no question about it. That money so -- don't -- took the money from the spotlight. And is Securities and Exchange Commission a -- landslide that they have. On more than half of the 24 pension fund consultants. That FCC reviewed. That failed to disclose significant conflicts of interest to their clients. Indy is today is world we -- what's happening in Detroit -- and California Florida and number of the plea to a who's who what's happened here. Should people feel comfortable about their their pension plan and their retirement Poland. You know it's absolutely amazing but old people or what we call registered investment church. And are supposed to disclose in writing any potential conflicts of interest they have. And almost an up then. Actively in Balkans Stamford litigation. And missed the plane issue that comes up there that they're receiving. And direct compensation. From the issue of the securities. Yet the the person the security really doesn't understand the amount of both people at -- Mike and all the conflict of interest. Well and and that's pervasive in the industry and. It's open in the -- be -- controlled and possibly you know law a criminal sanctions put in play a cult people. Don't understand. That the person has given them their investment advice is also benefiting. From the investment advice and really what the abuses to the ideas they have sometimes call trailing pretty. Where -- these people continue to get -- wall is the people. Leave them money output this investment and that clearly becomes a conflict also are not rocket past the person to take the money outlook also Malone get the trailing pretty. Do you see anything being done concerning all laws concerning the changes that. Apparently need to be done. Yeah I think. Kevin Pearce in the Louisiana legislature. And empowerment radar screen. And these and I ask for certain recommendations on books. Tie ball that low we've yeah ownership and act to try not to make sure that we have the proper sanctions for people like lecture people likes it go. That take the public -- like this. Or one point portions and should be involved in this from solo. I saved firefighters' unions and of the unions. Alabama and in a year Mississippi taxes. Buying golf courses why. Do you have any idea why every every golf course that. I -- agreement to resided there struggling or. Just barely holding the line and. Yeah. Unknowable reason why that the campaign just invest in the stock market okay. And that they have there's pressure on. Some aren't sufficient amount each year to meet the pension benefits -- the knicks call to to refer to earlier with Detroit. And historically like in the eighties when interest rates were. 12% 20% they can meet those expectations. Of old -- But now with interest rates is lowest scale war. They don't have any alternative but to go into alternative investments. To meet that expectation. I'll book the -- fishers of appliance and is not something in this unique to Louisiana -- just different strategies and it's. Are all on tall -- -- estates. To invest and probably equities. And not necessarily insecurities that are traded on the new York stock action. -- chuckle because of their fiduciary responsibility. To continue. Attitude to produce the the funds that were promised. Almost all retirement solutions or being forced again into dangerous investments. Well I would call dangerous kind. But calls a lot of people have made money in private equity so kind. They they're just not readily marketable that makes stemming. To another word. Unlike stocks are traded on the New York Stock Exchange the sparks deteriorate you can go well solemn the next day. Where when you are under indirect burrito spot and profit equity fund. You'd you don't have bolted to liquidate is quick and so. It's it is not quite as marketable but the expected rate of return to our but. I don't think is more bankers I think it's less marketable but a lot of people made a lot of money in the Providence equity market. Bill low very introducing something not borrow and certainly adds to the shows we're -- retirement appreciated the call very much you have good solid year. Go price counsel for the three retirement funds and he used with prices cordon in Baton Rouge governor and actually talk to state treasurer John Kennedy about this whole issue.