In venture capital circles, Ellen Pao is known as the woman who shone a spotlight on alleged sexism at one of the industry’s best known firms, and across the male-dominated profession.
In Boston and New York, she might be best known as the wife of Alphonse “Buddy” Fletcher Jr., the manager of a bankrupt group of hedge funds who defrauded his clients, according to a New York bankrupty trustee’s report. One of those clients was the MBTA pension fund, which lost the entire $25 million it invested in a Fletcher fund in 2007.
The MBTA’s $1.6 billion retirement fund invested in the Fletcher hedge fund at the recommendation of the T fund’s former executive director, Karl White, who had gone to work for Fletcher. White left Fletcher Asset Management in 2008 but did not tell the T. In 2011, Fletcher was still reporting positive gains on the investment, although most of the money was missing by then, according to the trustee.
Fletcher has denied wrongdoing.
The T pension fund has sued Fletcher and its auditor.
Former Massachusetts attorney general Martha Coakley’s office launched an investigation into the hedge fund loss, an inquiry that continues under Maura Healey, according to a person briefed on the matter.
Pao lost her case Friday against Kleiner Perkins Caufield & Byers. She had been seeking $16 million plus punitive damages. Had she won, it’s unclear whether that money could have been seized by the bankrutpcy trustee, or if Pao’s assets are shielded in the case. Pao’s lawyer was not immediately available for comment; nor was a lawyer for the T.
Three Louisiana public pension funds also had invested $100 million in the Fletcher fund.