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Manhattan money manager Alphonse “Buddy” Fletcher Jr. is proving to be better at making enemies than profits.
Fletcher, who is in a high-profile tussle with the Dakota co-op, is now accused of creating an “intricate shell game” to separate his investors from their money.
Three pension funds for Louisiana firefighters and municipal employees say almost all of their $100 million investment in the 47-year-old’s hedge fund is missing.
Fletcher Asset Management claimed to have $554.8 million as of April 4. But once the pension funds tried to get their money, Fletcher allegedly began to shift money around.
Then its master hedge fund, Fletcher International, filed for bankruptcy in New York and changed its ownership structure.
“Forty-four million dollars of cash and other items of value were taken out of [Fletcher International] as part of that transaction,” said David Lurie, a lawyer for the pension funds.
There’s been “an incredibly and deliberately intricate shell game of corporate structures … designed to frustrate efforts even to take the first step of tracing what happened with the money,” he said.
The pensions invested with Fletcher in 2008, after he promised 12 percent annual returns. The first signs of trouble emerged when the funds tried to withdraw their money. They were ultimately offered only $5 million in cash. That led them to start a legal proceeding to liquidate their holdings.
Fletcher’s moves seem to confuse even one of his own executives. Fletcher International President Floyd Saunders on July 19 said the fund was now owned by a different entity than he thought.
The change in ownership — made right after the liquidation proceedings began — meant the firefighters and municipal employees no longer had a claim to the assets, according to Fletcher.
As lawyers argued and Fletcher moved assets, the value of the FIA Leveraged fund that the unions invested in dwindled. The fund had only $22 million in June, according to court papers.
“We don’t have any explanation of what happened to the money. It wasn’t lost [as a result of trading]; it has disappeared,” said a source close to the situation.
In late July, Fletcher’s attorneys asked for an extension of the time to file an accounting of its assets and liabilities until Sept. 7.
This battle is just the latest in a long list of Fletcher legal twists and turns.
In February 2011, Fletcher, who is African American, claimed racial bias in legal battle with the Dakota on Central Park West. Fletcher, who already owns four apartments in the iconic building, wanted to buy a fifth, but the co-op refused, arguing he didn’t have the financial wherewithal.
The case is still winding through the courts, but a source close to the Dakota told The Post that Fletcher’s bankruptcy filing supports the board’s position.
In the Nineties, Fletcher sued Kidder Peabody for racial bias and lost. Years later, Fletcher — openly gay at the time — himself was sued by two men for sexual harassment.
Meanwhile, Fletcher recently got married and had a child. His wife, Ellen Pao, is suing venture-capital firm Kleiner Perkins Caufield & Byers for sexual discrimination.
Fletcher Asset Management is reportedly the subject of an investigation by the Securities and Exchange Commission and the FBI.
Fletcher’s lawyers did not return a call for comment. Reps for the pension funds declined to comment.