County unsure of invesment pool loss total
KINGMAN - The future of county and local investments in Lehman Brother bonds is still up in the air.
Earlier this month, the Mohave County Treasurer's Office sent out letter notifying local school boards, fire boards and other tax entities that had funds in the county's investment pool, that the county would be withholding any funds invested in Lehman Brother bonds due to the September bankruptcy of the investment firm.
The county had $5.1 million worth of funds from local taxing entities invested in Lehman Brothers bonds. Phone calls to County Treasurer Melissa Havatone were not returned.
Lehman Brothers was heavily invested in sub-prime mortgages in the U.S. The firm is now the subject of five criminal investigations conducted by U.S. attorneys in the Southern District of New York, the Eastern District of New York and the District of New Jersey, a bankruptcy court examiner and an investigator from the Securities Investment Protection Corporation.
The question, currently, is how much the county and the local taxing entities will get back after the bankruptcy court.
"This is one of those things that no one could predict," said Board of Supervisors Chairman Tom Sockwell. "I don't know if it could have been avoided. You never know when things will go sour."
"Who knows what we could get back," said Supervisor Buster Johnson. "They could get it all back or just a little."
It all depends on what happens after the bankruptcy court, he said. The loss of principle could be offset by the interest some taxing entities earned before the brokerage went bankrupt.
Barclays Capital purchased Lehman Brother's North American brokerage last year.