Teachers Union Adds Highbridge, GTCR To Watch List

Mar 17 2014 | 3:47am ET

The American Federation of Teachers has added a hedge fund and private-equity firm to its list of money managers it recommends teacher pensions avoid.

Highbridge Capital Management and GTCR support the elimination of defined-benefit pension plans, the AFT’s updated report alleges. The first edition, released last April, included the likes of Appaloosa Management, Elliott Management, Icahn Enterprises, SAC Capital Advisors, Tiger Global Management and Tudor Investment Corp.

The report will be issued to pension funds on March 18.

“We’re trying to make sure that pension funds know the efforts that some of these same asset managers have made to harm retirement security,” AFT President Randi Weingarten told Pensions & Investments. “The exercise was simply to say these are asset managers—while they are seeking to enrich themselves or make money off of your pension fund, they are also actually trying to diminish participants’ retirement security or other participants’ retirement security.”

Highbridge has run afoul of the AFT because co-founder Glenn Dubin is a contributor to StudentsFirstNY, which the union says argues that states should do away with DB plans. GTCR was cited for its ties to former chairman Bruce Rauner, now a Republican candidate for governor of Illinois and an advocate “for the elimination of defined-benefit plans.”

The AFT also added Aon, the parent of Aon Hewitt and Hewitt EnnisKnupp, to its list, while removing hedge fund Khronos and Centaurus Advisors. The former got off due to the departure of managing partner Rafael Mayer from StudentsFirst’s board, and the latter due to its liquidation.

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