THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Friday, October 6, 1995 TAG: 9510060540
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: ASSOCIATED PRESS
DATELINE: RICHMOND LENGTH: Medium: 52 lines
The federal government is ending its investigation of the Virginia Retirement System takeover of RF&P Corp., U.S. Attorney Helen F. Fahey said Thursday.
Wednesday's resentencing of former VRS counsel Patrick R. Bynum ``marks the end of a federal criminal investigation into matters pertaining to the Virginia Retirement System,'' Fahey said in a two-page statement.
The $19 billion retirement fund acquired RF&P in 1990, sold off its rail assets and kept its extensive real estate holdings. VRS funds the pensions of state workers and teachers.
In a September 1994 federal court filing, Fahey's office accused former VRS trustees Jacqueline G. Epps and Mark T. Finn, and the fund's former administrator, Glen D. Pond, of secretly engineering the acquisition and attempting to personally profit from the $548 million deal.
The Richmond Times-Dispatch reported last month that Epps, Finn and Pond were given immunity from prosecution, and Bynum was the only person prosecuted in the case.
According to court filings made by the government, Bynum became aware of a plan to acquire shares of RF&P stock by the pension fund officials prior to the sale. Bynum sent false answers about the acquisition through the U.S. Postal Service to requests under the Freedom of Information Act made by the Times-Dispatch. He pleaded guilty to a felony charge of mail fraud.
After cooperating with the government's investigation, a federal judge vacated Bynum's two-year sentence and placed him on probation for two years.
Virginia Attorney General James S. Gilmore III will continue to work to determine whether state law was violated in the takeover, said spokesman Mark Miner.
Fahey said her office, along with the criminal division of the U.S. Department of Justice, ``has concluded that there is a lack of proof of federal offenses and has decided not to present any further criminal charges to the grand jury arising out of the VRS's 1990 secret purchases of RF&P stock and subsequent 1991 public acquisition of the RF&P Corp.''
``The VRS-RF&P investigation is now closed,'' Ms. Fahey said.
The investigation began in October 1992 after an informal probe of the deal by Gilmore's Democratic predecessor, Mary Sue Terry. That probe examined whether there were schemes to manipulate the price of RF&P stock, insider trading, violations of disclosure requirements of the securities laws, or misappropriation of confidential information. by CNB