Failed real estate investments were a major source of losses for Detroit’s police and fire pension and general employee fund, according to their 2011 annual reports, Bloomberg reported.
One businessman who received funds from the two pensions to invest in real estate became entangled in a federal case that led to indictments of a number of city officials on charges of bribery, extortion and kickbacks that resulted in losses of more than $84 million for the pensions, the news outlet said.
The bad real estate deals are partly behind the city’s decision to propose cutting their benefits in its recent bankruptcy filling. Source: Bloomberg
