State Auditor: St. Paul School Lost $4.3 Million In Risky Hedge Fund Investment

The Citizen

4 years ago

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ST. PAUL, Minn. (WCCO) — A state auditor’s investigation concluded that Hmong College Prep Academy didn’t follow Minnesota law when it invested $5 million into a hedge fund.

The St. Paul school was only able to get back $700,000, a loss of $4.3 million. The auditor’s report says the school invested in Woodstock Capital, a U.K.-based hedge fund. State law does not allow schools to invest in hedge funds or European government bonds.

Minnesota State Auditor Julie Blaha noted that the school’s authorizer, Bethel University, has recommended that the Hmong College Prep Board fire superintendent Christianna Hang and hire an outside attorney to investigate the investment.

While the exact intent of the investment is not known, Blaha said she believes the investment was supposed to help pay for a new middle school.

“We absolutely understand that in schools resources are tight,” Blaha said. “That’s actually the reason why you have to pick safe investments. There isn’t the kind of money that you can risk on this. We know the resources our kids need for a good education are just too important.”

Earlier this month, the school sent out a letter to families, saying that it’s taken several steps to address Bethel University’s recommendations.

When WCCO-TV reached out to Hmong College Prep Academy, the school had no comment other than to say the findings of the state auditor are under review.

The state auditor’s report is now in the hands of the Ramsey County Attorney’s Office.

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