Investment probe – Losses could total $231M

An Oregon philanthropist is in limbo, waiting to find out if he will be charged in a continuing federal criminal investigation into his work as a investment manager, The Wall Street Jo8urnal reported Nov. 13.

On Sept. 21, the Securities and Exchange Commission and Department of Labor filed complaints in federal court charging Jeffrey Grayson and his investment-management firm, Capital Consultants LLC, with fraud and self-dealing involving $231 million in client funds.

Alleged wrongdoing began will a $160 million loan to a local entrepreneur that failed and climaxed with a $71 million scheme to cover up the initial loss. Based on government filings, client losses could exceed $150 million.

Following the Sept. 21 charges, Capital Consultants was placed in control of a court-appointed receiver. Currently, thousands of union members wait to learn the impact on their pensions and benefits.

Grayson, an aggressive businessman, is one of Oregon’s leading philanthropists. In the mid-1990’s, he co-chaired the largest fundraising campaign in the state’s history, bringing $255 million to the University of Oregon.

He and his wife pledged $1.5 million and the school renamed a building in their honor.

Additionally, Grayson, who suffers from multiple sclerosis, helped a local multiple sclerosis society quadruple it’s annual budget to $2.4 million. 

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