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Sat Aug 18, 2012, 12:21 PM

North Carolina retirees lost at least $4.1 million on Facebook, state discloses

(I can't blame Janet Cowell for this....but, the connection to Erskine Bowles is interesting. Did he influence the State to take such a high amount of Facebook shares because of his ties to Morgan-Stanley?)


North Carolina retirees lost at least $4.1 million on Facebook, state discloses
By John Frank - jfrank@newsobserver.com
Published in: State

North Carolina’s retirement system has seen the value of its Facebook investment plummet at least $4.1 million, according to newly filed legal documents.

The state’s retirement system last week joined a class action lawsuit against the social networking site and its underwriters, including Morgan Stanley and Goldman Sachs, that alleges the companies misrepresented Facebook’s initial public stock offer earlier this year. The original lawsuit was filed in May.

But the full extent of North Carolina’s exposure to the company’s dwindling stock value only became clear in court documents filed Aug. 9 in a New York federal court. The state disclosed the loss as it fights to be named among the lead plaintiffs in the case.

“Facebook and its underwriters told one thing to the public, but shared the real facts with only a few select investors on Wall Street,” State Treasurer Janet Cowell said in a statement. “Our goal is to recover our pension fund’s financial damages.”

The state pension fund – valued at $75.9 billion March 31 – provides retirement benefits for 850,000 current and former state workers.

The fund bought 685,737 shares of Facebook stock May 17 at the initial price of $38 a share, according to documents from the state treasurer’s office. The state’s stock portfolio managers then sold a small portion of the $26 million investment the next day, making about $215,000.

But the stock dropped nearly 20 percent in the first two days and now sits at nearly half its original value. The state’s reported $4.1 million unrealized loss is a legal calculation and the total amount could be much larger.

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North Carolina argues in court documents that it deserves the preferred status as lead plaintiff because it suffered the biggest loss, by a wide margin, among the investors seeking to direct the lawsuit. The New York law firm Bernstein Litowitz Berger and Grossmann is representing the state.

But a competing law firm is raising questions about whether North Carolina can serve as lead plaintiff given the state treasurer’s ties to Facebook and Morgan Stanley board member Erskine Bowles, who is a named defendant in the lawsuit.


More at:

http://www.newsobserver.com/2012/08/18/2275711/north-carolina-retirees-lost-at.html

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Reply North Carolina retirees lost at least $4.1 million on Facebook, state discloses (Original post)
KoKo Aug 2012 OP
BlueToTheBone Aug 2012 #1
littlewolf Sep 2012 #2
littlemissmartypants Sep 2012 #3

Response to KoKo (Original post)

Sat Aug 18, 2012, 01:03 PM

1. Whoever chose to put retirees money in FB was a fool

A big fool or was in bed with Morgan Stanley and got a big chunk of cash on this dog.

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Response to KoKo (Original post)

Sat Sep 8, 2012, 07:01 PM

2. lovely ... I don't draw for 5 more years ....

but me thinks this is gonna put a crimp in things ...

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Response to KoKo (Original post)

Tue Sep 25, 2012, 11:06 PM

3. The 'good ole boys' just never give up do they?

That is a network DHS should have under surveillance. Too bad that network out dates DHS by about 300 years in this state.

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