Pensions Seek Liquidation Of Fletcher Hedge Fund

Feb 16 2012 | 2:49am ET

Three Louisiana pension funds have apparently had their fill of Fletcher Asset Management.

The public pension plans have filed a winding-up petition against the New York-based hedge fund's Cayman Islands-domiciled vehicle, calling for its liquidation. In the Caymans filing, the pensions wrote that the Fletcher fund "is unable to pay its debts" and "should be wound up." The lawsuit further alleges that Fletcher has filed no audited financial statements in three years and that the fund appeared to have no directors between Nov. 21, 2011 and Jan. 24.

The Louisiana pensions, which invested $100 million with Fletcher almost four years ago with a guaranteed return of 12%, also noted that Fletcher was facing a regulatory investigation in the U.S.

The winding-up petition follows almost a year of negotiations over the pensions' redemption requests. The pensions sought to redeem $32 million in July, only to receive promissory notes. The three then filed redemptions for the full $140 million their account statements say they have.

Fletcher has denied any wrongdoing.

A spokesman for the Louisiana Firefighters' Retirement System, Louisiana Municipal Employees' Retirement System and the New Orleans Firefighters' Pension and Relief Fund, Steven Stockstill, said that the three plans would continue to pursue "all other feasible options" alongside the winding-up petition.

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