What is the old adage in journalism?
Follow the money, right? Well, when you start to do that in this case something seems a little, well – off key.
The story begins in the Spring of 2008. New Jersey invests $182 million of state pension money into an ailing Lehman Bros. Four months later, the investment house fails and NJ losses $118 of that investment. As one Republican told me, the only two entities to invest in Lehman at that time ( while its stock price was plummeting ) was NJ and the government of South Korea.
anyhoo…the state then proceeds to sue Lehman to recoup the money ( I know, right?!! get in line ), but that’s not the scandalous part of this story.
Apparently three members of the Investment council who were appointed by the Governor, then reappointed earlier this year had ties to Lehman when that decision was made. Each of them either worked or had worked for the investment giant.
Their re-appointments must be approved by the Senate Judiciary Committee and ultimately the full Senate. So, Republicans on the committee have asked to interview them publicly. “No,” says Paul Sarlo, the Chairman of the Judiciary Committee. There are too many appointments that need to be considered…and besides, The Investment Council doesn’t make any decisions related to investing state pension funds, the Division of Investment does.
Apparently the council’s job is only to help set policy. But the fact that they have no role differs slightly from what Treasury Department Spokesman Tom Vincz says which is that all three members “recused themselves” when it came to the decision about the Lehman investments.
So, which is it?
To be fair, the $118 million is only a fraction of the state’s $60 billion pension fund. But that’s still a lot of money.
Doesn’t this whole affair remind you slightly of the plot to that 1995 Scorsese film “Casino.” Just without all the murder, drugs and mob ties…or none that we know of.