Robin Hood eyed for giving to rich

The Robin Hood Foundation is under scrutiny by Congress for investing charitable money into its donors’ and members’ hedge funds, Bloomberg reported.
JUL 16, 2007
The Robin Hood Foundation is under scrutiny by Congress for investing charitable money into its donors’ and members’ hedge funds, Bloomberg reported. The New York-based charity has an emergency fund that grew to $144.5 million from $20 million in less than 20 years. Half of the money has been invested into hedge funds managed by the charity’s donors and board members, who are collecting the standard fees of 2% of the managed assets, plus 20% of the profit, Bloomberg said. Industry figureheads, such as Goldman Sachs’ CEO Lloyd Blankfein and Lehman Brothers’ chairman Richard Fuld, as well as film stars, including Gwyneth Paltrow, sit on the 31-member board. “I don’t remember Robin Hood keeping two and 20 as his cut,” said Iowa senator and Senate Finance Committee ranking member Charles Grassley, to Bloomberg. According to its 2005 tax filings—the most recent available—the charity had its long term assets invested into 19 hedge funds, seven of which were either managed by board members or the group’s leadership council, Bloomberg said. That year, the foundation paid about $14 million in fees. Although the foundation’s actions aren’t illegal, they may give the appearance of a conflict of interest, Bloomberg reported. The issue arises just as Congress discusses boosting taxes on hedge funds, private equity firms and their managers.

Latest News

Fintech bytes: Envestnet reaffirms $1B RIA commitment with Tamarac tech investment
Fintech bytes: Envestnet reaffirms $1B RIA commitment with Tamarac tech investment

Also, Orion has added BlackRock, Fidelity, and Vanguard to its custom portfolios suite, and RedBlack has set up a new headquarters after crossing a trillion-dollar milestone.

RIA moves: Maridea acquires multigenerational practice in Pennsylvania debut
RIA moves: Maridea acquires multigenerational practice in Pennsylvania debut

Also, New York-based Legacy Edge Advisors names its first-ever CEO, while Novare Capital Management hires a Vanguard veteran with a multigenerational planning focus.

Private equity eyes 401(k) plans, but fees remain a hurdle
Private equity eyes 401(k) plans, but fees remain a hurdle

Asset managers are racing to bring private market products to retirement plans, but cost and liquidity concerns linger.

IRS floats proposal ending tax breaks for schools that weigh race
IRS floats proposal ending tax breaks for schools that weigh race

Treasury's latest tax-exemption crackdown on private schools lands in the wake of a separate push to restrict refundable credits for some immigrant filers.

Trust over tech:  The hidden signal of stock success in the AI era
Trust over tech: The hidden signal of stock success in the AI era

Workforce trust measures predicted which companies came out ahead during COVID-19. The same dynamic may now be playing out across the AI transition — and the data suggests the spread could be just as wide.

SPONSORED Direct indexing webinar targets tax-loss harvesting amid market swings

Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains

SPONSORED Who builds the income when the pension disappears?

Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income