The feds have ramped up their investigation of Manhattan hedge fund Fletcher Asset Management, The Post has learned.
Fletcher International, the hedge fund run by Alphonse “Buddy” Fletcher, filed for bankruptcy in June amid a battle with three Louisiana pension funds seeking to recover $100 million they invested.
The investors say the money has disappeared, and they have accused Fletcher of an “intricate shell game” to move the money around in what a bankruptcy judge has called a “hydra-headed organization.”
The FBI investigation began more than a year ago, but it gained momentum after the bankruptcy filing. In fact, recently agents went to the pension fund and carted away boxes of records.
“I’ve spoken with the FBI on several occasions during the last couple of months, on the phone and in person,” said Robert Rust, the administrative director with the Municipal Employees Retirement System of Louisiana, one of the pension funds battling Fletcher. “For a while, I was hearing from them every other day.”
Rust said the FBI has requested e-mails and other documents on the pension’s investment with Fletcher, as well as the pension fund’s annual reports. The Securities and Exchange Commission also “has gotten a gang of documents,” he said.
The FBI has not told the pensions the exact focus of their investigation.
Due to a confidentiality agreement with Fletcher, the pension funds did not give the FBI its review of Fletcher that was conducted by Ernst & Young in July of 2011 at the pension funds’ behest, he said.
At that time, the pension funds said their preliminary review of the accounts indicated that their investment had a profit of $40 million and that they could get back all the money they were owed.
However, Rust said that optimistic view changed “the more information we received.”
A spokesman for Fletcher did not return a request for comment.