Wall Street Smells UAW VEBA Blood in the Water

Frank Williams
by Frank Williams
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wall street smells uaw veba blood in the water

Because health care VEBAs normally contains less than $1b in assets, they're usually nothing more than a sideline for sleepy old pension fund managers. But, as Bloomberg reports, a VEBA the size of the one The Big 2.8 have agreed to bestow upon the United Auto Workers (UAW) is a whole 'nother kettle of fish. At $54.4b, it's plenty big enough to catch the [cold, dead] eye of the big boys like JP Morgan Chase & Co., State Street and Merrill Lynch. According to trade publication Pensions and Investments, this health care fund is the same size as the University of California's pension fund endowment– which is the nation's 25th largest. UAW president, Ron Gettlefinger says his organization has been "inundated" with offers from Wall Street to manage the trust. And why not? Independent investment consultant Geoff Brobroff estimates the fees for managing the VEBA could total $285 million (not including kickbacks). Nice work if you can get it.

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  • Shaker Shaker on Nov 16, 2007

    The buzzards are circling...

  • Robert Schwartz Robert Schwartz on Nov 16, 2007

    "Geoff Brobroff estimates the fees for managing the VEBA could total $285 million (not including kickbacks)" per year!

  • Landcrusher Landcrusher on Nov 16, 2007

    Anyone who takes the job of managing that money had better know they are going to die of a fatal disease before they get sued or even thrown in jail. Likely, someone will get the business for a firm, take the money, and run like hell to distance themselves from what will surely end in a federal inquiry or the mother of all tort cases. Not to mention death threats from the members whenever an investment goes bad.

  • Georgy Georgy on Jan 07, 2008

    For a historic overview of the dilemma of organized labor from conservative retired activist union rebels see... http://michaelwestfall.tripod.com/id50.html