- Globe and Mail: Borealis deal stuck OMERS with whopping managing fees
The fund set up Borealis Capital Corp in 2001, in part to use the employee pension funds to invest in public-private partnerships like hospitals, airports and the Confederation bridge.
But as it turns out, the deal, cut between the former head of OMERS and the new subsidiary was far too rich for current OMERS head Paul Haggis, who bought out Borealis other investors in Feb. 2004 and disolved the company.
While Haggis would not say the total cost of the fiasco, the Globe article suggests the arrangement cost OMERS almost $100 million just in the last 12 months.
Says the article, the expensive and unnecessary escapade ended up enriching a few investors and managers at the expense of 340,000 active and retired workers.
In the article, Haggis admits that the OMERS board on which CUPE has but one member never saw any of the paper on Borealis. Haggis told the Globe: I’m not sure the board was even involved in these decisions because they were below the radar screen. In fact for sure they weren’t.
Accountabilty and transparency is going to be on the agenda at the CUPE Ontario Division convention, CUPE Ontario official Antoni Shelton told the Globe.
Much of what went on at Borealis was kept away from the board. It is very difficult to hold senior management accountable when you do not have the information, Shelton said.