It may not feel like it when you have placed your faith and savings in a money manager who assured you his bets were low-risk and the fund blows up, which is what happened to a municipal employee pension fund in New Orleans, which made what turned to be an unwise bet when they handed over their hard-earned cash to a JPMorgan banker to invest in various securities, agreeing to absorb whatever losses the bank suffered in hopes of ekeing out a return. All was well until the manager, a seemingly “low-key Wall Street everyman” (aren’t they all), placed their money in a vehicle known as Sigma, which blew up during the crisis, losing them the $340,000 they had earned. Naturally, they were upset.
In January 2009, a representative from JPMorgan, Robert Bentz, visited to discuss the situation.
“These are not easy meetings,” Mr. Bentz began, according to a tape recording from the meeting.
Mr. Bentz told the New Orleans officials that former workers from Citigroup created Sigma.
“So it was like Bernie Madoff!” one city official exclaimed.