Hedge fund likely broke pension protections
Hedge fund Alden Global Capital likely violated federal pension protections by putting $294 million of its newspaper employees’ pension savings into its own funds, according to a Labor Department investigation.
Alden is presently the leading bidder for Tribune Publishing’s titles, including the Chicago Tribune and Baltimore Sun. It has already purchased at least 200 newspapers, often aggressively cutting staff and selling off the papers’ assets to boost profits.
Alden also took advantage of their newspaper employees’ pension savings, according to a 2019 decision by the Labor Department, a copy of which was obtained by the Washington Post through a Freedom of Information Act request.
Among the agency’s findings was that the three administrators governing pensions for current and former employees of the Denver Post and other Aldencontrolled newspapers were affiliated with Alden or its media company, MediaNews Group.
Acting as fiduciaries of the pensions, the three administrators moved hundreds of millions of dollars of the employees’ savings into two Alden-controlled funds between 2013 and
2015, according to the decision. Federal law protecting pension holders, the Employee Retirement Income Security Act, requires that pensions be invested solely on behalf of retirees and not in a way that could benefit the pension managers themselves.
The agency issued no penalties, it said in the decision, but extracted a series of substantial changes from the hedge fund, including the liquidation of the plans’ investments in its funds as well as $20.7 million in payments to the pension plans to make up for losses and missed opportunities caused by the alleged violations.