Conn. Sues Ex-Univ. Endowment Chief Over Hedge Fund Business

Aug 25 2010 | 12:18pm ET

Connecticut’s attorney general has sued the former endowment chief at Wesleyan University for allegedly setting up and running a hedge fund while on the school’s payroll.

The lawsuit accuses Thomas Kannam of misusing, “at a minimum, tens of thousands of dollars in university assets” to benefit several companies with whom he had ties, including hedge fund Cross Border Capital Advisors, which Kannam founded in 2001. The lawsuit from Conn. Attorney General Richard Blumenthal—who is running for the state’s U.S. Senate seat—follows similar litigation filed by Wesleyan against Kannam in January, now in arbitration. Kannam was fired by the Middletown school in October.

In its lawsuit, Wesleyan claimed that Kannam’s “outside employment” was “in breach of his duty of loyalty, his employment agreement and the university’s conflict of interest policy.” The school said that “a significant portion” of the phone calls Kannam made from his university office, as well as a majority of his e-mails, dealt with his “personal entrepreneurial ventures.”

Blumenthal further alleges that Kannam billed the university for his business-related travel, including the “golf outing of the century” in California and a trip to the Super Bowl.

Kannam has denied any wrongdoing, and his lawyer blasted Blumenthal’s suit.

“There’s no need for the attorney general to file this, what I call a ‘me too’ lawsuit, on behalf of an institution as large and powerful as Wesleyan,” Stephen Fitzgerald, Kannam’s lawyer, told Bloomberg News. “Alumni, faculty and students should also be distressed that the university’s leadership has chosen to spend thousands of dollars in legal fees on a case that will ultimately produce million- dollar counterclaims against the school by those whose reputations have been severely injured by Wesleyan’s reckless allegations.”

Wesleyan said it “shares the concerns expressed by Mr. Blumenthal and we remain ready to help.”


In Depth

Why Ponzi Schemes Work: An In-Depth Look At The Allen Stanford Fraud

Dec 21 2014 | 10:30am ET

Texan Allen Stanford first appeared on the radars of financial regulators in 1997...

Lifestyle

Hedgie Funds US Squash Program

Dec 24 2014 | 8:46am ET

Squash, anyone?

Guest Contributor

EidoSearch’s Top Three Market Projections For 2015

Dec 23 2014 | 4:03am ET

It is that time of year again when prognosticators make their big market calls for...

 

Sponsored Content

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

December 2014 Cover

Futures 2014 person of the year

Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.