WASHINGTON – Hedge fund Alden Global Capital likely violated federal pension protections by putting $294 million of its newspaper employees’ pension savings into its own funds, according to a Labor Department investigation.

Alden is presently the leading bidder for Tribune Publishing’s titles, including the Chicago Tribune and Baltimore Sun. It has already purchased at least 200 newspapers, often aggressively cutting staff and selling off the papers’ assets to boost profits.

Alden also took advantage of their newspaper employees’ pension savings, according to a 2019 decision by the Labor Department, a copy of which was obtained by The Washington Post through a Freedom of Information Act request.

Among the agency’s findings was that the three administrators governing pensions for current and former employees of the Denver Post and other Alden-controlled newspapers were affiliated with Alden or its media company, MediaNews Group (MNG).

Acting as fiduciaries of the pensions, the three administrators moved hundreds of millions of dollars of the employees’ savings into two Alden-controlled funds between 2013 and 2015, according to the decision. Federal law protecting pension holders, the Employee Retirement Income Security Act (ERISA), requires that pensions be invested solely on behalf of retirees and not in a way that could benefit the pension managers themselves.

In the decision, James J. Purcell of the Labor Department’s Employee Benefits Security Administration, wrote to an Alden attorney that “our investigation revealed that plan-level deliberations and investment decisions” were made by Alden associates despite requirements that fiduciaries generally avoid conflicts of interest with the investors who oversee funds in which the pensions place money.


By moving the pension plans’ money into two Alden funds, the fiduciaries “did not comply with applicable plan provisions and fund investor restrictions, and steps were not taken to ensure that the interests of the Plans would be separately and distinctly represented in the transactions,” Purcell wrote.

The agency issued no penalties, it said in the decision, but extracted a series of substantial changes from the hedge fund, including the liquidation of the plans’ investments in its funds as well as $20.7 million in payments to the pension plans to make up for losses and missed opportunities caused by the alleged violations.

Alden Global Capital spokeswoman Chrissy Carvalho issued a statement saying that Alden and the three administrators named in the decision – Maziar Akram, Martin R. Wade III and R. Joseph Fuchs – had done nothing wrong. All three have served on the MNG board.

“As reflected in the correspondence you reference, EBSA made no conclusive findings, all assertions of wrongdoing were disputed, and EBSA closed its investigation following actions taken voluntarily by MNG and plan fiduciaries,” Carvalho said.

A Labor Department spokesman declined to comment.

Alden, controlling owner of MediaNews Group, has purchased newspapers including the San Jose Mercury News, Orange County Register and the Boston Herald.

Alden and its managing partner, Heath Freeman, are known for aggressively cutting newspaper jobs to spur profits, and are currently the leading bidder for Tribune Publishing. That has prompted protests from employees and readers of some of the papers it would be acquiring, including the Chicago Tribune and the Baltimore Sun.


The two Alden funds that received the pension investments were the Adfero fund and the CRE fund, an investment vehicle focused on commercial real estate and based in the Cayman Islands.

Although Alden admitted no wrongdoing and received no penalties, the Labor Department’s decision detailed a series of changes made in response to the agency’s investigation.

The fiduciaries liquidated the pension plans’ holdings in the two Alden funds. MNG made payments to the plans totaling $20.7 million to make up for losses and wasted opportunities, according to the nine-page decision.

MediaNews Group executives also signed an agreement saying it had no intention to make any future investments in funds sponsored or controlled by Alden. The plans are now being monitored by an outside investment consultant, Cambridge Associates LLC.

It appears Alden will know whether it will be able to acquire Tribune by May 21, when Tribune shareholders have scheduled a vote on Alden’s $630 million bid. Maryland businessman Stewart Bainum Jr. had teamed with Swiss billionaire Hansjörg Wyss on a competing bid, but Bainum informed the Tribune board recently that Wyss had pulled out.