Chancellor releases update on fraud suit

Chancellor Mark Nordenberg issued an update on Monday regarding Pitt’s action against alleged… Chancellor Mark Nordenberg issued an update on Monday regarding Pitt’s action against alleged scammers in an investment scheme that victimized Pitt. Pitt sued Westridge Capital Management Inc. principals Paul Greenwood and Stephen Walsh last month for allegedly misappropriating University funds. It is estimated that Pitt invested $65 million in Westridge. The investment strategy was conservative, said Nordenberg, and ‘designed to deliver modest returns with little risk.’ Pitt first grew concerned when the two Westridge principals refused to comply with an inquiry issued by the National Futures Association, an investment regulatory organization. ‘We first demanded a return of our funds,’ said Nordenberg. Pitt’s efforts were unsuccessful, and it joined forces with Carnegie Mellon University, a fellow Westridge investor, to file suit against Greenwood and Walsh. Pennsylvania court issued a restraining order that froze all Westridge assets. However, Pitt and CMU requested that the judge temporarily suspend the trial because of similar allegations raised in New York City. Shortly after court proceedings began in Pittsburgh, the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission filed civil action against Westridge. The universities did not want Pittsburgh action to interfere with the efforts of federal officials, said Nordenberg. Because the case is still pending, Pitt could not release figures as to how much it will lose, said Vice Chancellor Robert Hill. There are no foreseen short-term impacts on distribution from the endowment, said Nordenberg, but potential losses must be gauged before the long-term effects can be determined.