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Taotao Tano urges FBI to probe Fund
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Posted on Dec 08 2008
Local group Taotao Tano is asking for a federal investigation into the Retirement Fund’s declining portfolio.
“This is a serious matter that must be taken into consideration for there is no immediate legitimate explanation of a threat of bankruptcy taking place in the very near future,” president Gregorio Cruz Jr. wrote in a letter to the Federal Bureau of Investigations. “The management and care of one’s contributions to the Retirement Fund ultimately lies within the agency itself and the answers to such unaccountability and responsibility must be addressed and sought out immediately to prevent such eminent threats of a complete loss of one’s years of contribution to include those pending retirement and are still employed and those who are retired and dependant of such retirement pensions.”
Cruz said the group fears years of mismanagement, cover-ups and politics between the Fund and the government is now taking a toll.
“A few years ago the decline listed in the Retirement Funds portfolio was estimated depletion within 15 years. Last month we estimated based on Merrill Lynch’s report at a Saipan Chamber of Commerce meeting to be 8 years, today it is estimated to be less than 4 years. This is a serious and everyone in our government is pointing fingers without immediate solutions or explanation of why, who and how it happened,” Cruz wrote.
In November, Kenan Knieriem, first vice president and account executive in charge of Merrill Lynch’s Institutional Advisory Division, said if the NMI Retirement Fund had been funded properly, it would have been worth $765 million at the end of 2007, based only on the return of assets. Instead, it was worth only $474 million.
During the first week of November, the Fund was worth just $330 million, according to Knieriem.
Last month Superior Court Associate Judge Kenneth L. Govendo found the CNMI government and Gov. Benigno R. Fitial liable in the lawsuit filed by the Retirement Fund over the government’s failure to remit the required employer contributions, now reportedly reaching over $119.6 million.
