Business: Fund Under the Gun

Imagine a vast investment trust, say $1.5 billion or so, that each year takes in hundreds of millions of dollars in small, but regular, tax-deductible cash contributions. Fantasize further that the trustees, with impunity, sink the money into anything they like—the pet projects of some dear friends, for example —while at the same time cutting out of the kitty many of the fund's supposed beneficiaries. Now let imagination truly soar: the trust's investment income is all taxfree.

Such a gravy train actually exists. It is called the Central States, Southeast and Southwest Areas Pension...

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