Vance says Schmidt mishandled Veterans Postwar Trust Fund
Mitch Vance, the Democratic-NPL challenger for state treasurer, said today that incumbent Republican Kelly Schmidt has mishandled the state Veterans Postwar Trust Fund, putting too much money at risk in a private investment firm and misreporting ...
Mitch Vance, the Democratic-NPL challenger for state treasurer, said today that incumbent Republican Kelly Schmidt has mishandled the state Veterans Postwar Trust Fund, putting too much money at risk in a private investment firm and misreporting the results to cover up her malfeasance.
Vance spoke to reporters in Grand Forks and Fargo, handing out copies of financial reports from the treasurer's office and the Edward Jones firm, saying the numbers don't match up.
Schmidt countered by saying Vance is playing politics with veterans issues, blaming her for the general downturn in the markets the past year.
Vance and a volunteer aide, Tom Magin, a retired law enforcement official from Fargo, say they recently obtained financial reports from Schmidt and Edward Jones that shows Schmidt reporting $300,000 more in bonds, securities and money market accounts with Edward Jones -- just over $4 million as of Sept. 30, 2007 -- than the $3.7 million that the reports from the Edward Jones firm indicate. They had to get the attorney general's office to order the release of some of the information, they said.
Vance also says that $3.6 million in trust fund money Schmidt transferred in mid-2005 out of Treasury Inflation Protected Securities managed by the state's Retirement and Investment Office into a diversified portfolio with Edward Jones now is worth $2.9 million. And it's meant taking on more risk for the veterans trust fund, Vance said.
Reached in her automobile after office hours for a response, Schmidt said she didn't have all the documentation in front of her.
But she said her moving trust fund money into privately managed investments was a smart move that has meant the veterans trust fund lost less than it would have in the bear market of the last two years.
The trust fund is balanced and prudent, with $2.9 million with Edward Jones in a variety of accounts and $1.1 million in federally insured CDs invested in "financial institutions throughout North Dakota."
"While the market is down 35 percent, the veterans trust fund is down 18 percent, to date, in the calendar year that ended Friday," Schmidt said.
It's meant being able to double the money paid out in benefits to veterans in the past year, Schmidt said, from averaging $109,000 a year from September 2004 to September 2007, to $208,200 in the past year.
The board of veterans administering the trust fund limits each year's giving to 4 percent of assets, she said.
Vance said among other things, Schmidt's use of the Edward Jones firm means she has spent more on management fees to brokers than if she had left the money in the state's RIO.
Schmidt countered, saying if she had improved the investment mix of veterans fund within the RIO, she also would have had to pay higher management fees.
Her father, husband and son are among many of her relatives who have or are serving in the military, Schmidt said.
"This isn't just a pool of money to me. This is something that helps the quality of life for my veterans and my opponent is trying to play politics with it."
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