Nonpublic session said unlikely in Trust Fund meeting

David Mayes ... owner of MacKensen & Company (Courtesy photo)

MILTON - The agenda for tonight's meeting between the president of the financial planning firm overseeing the town's trust funds and Milton's Trustees of the Trust fund notes a nonpublic session, but it's likely the entire proceedings will be open to the public.

According to Town Administrator Liz Dionne today, there are few variables that would call for nonpublic session.

The Board of Selectmen was also invited to attend, but Dionne was not certain if all would be able to attend due to job constraints.

Tonight's meeting is being held following revelations that MacKensen & Company, the firm overseeing the town's trust funds investments, was recently fined $100,000 for using misleading advertisements to woo prospective clients.

MacKensen & Company, and the firm's former owner, Warren J Mackensen, were censured in an SEC ruling on Sept. 3, which also levied a $100,000 fine on the company.

MacKensen has since ended his tenure as the firm's president and has been replaced by new owner David Mayes.

The censure was based on an SEC finding that MacKensen & Company sent form letters from 2010-2012 to potential municipal clients like Milton that claimed actual growth figures while they were, in reality, only hypothetical, back-testing investment models.

A second censure noted that the company failed to develop policy to prevent such deceptive promotions among its company.

The SEC said those letters resulted in an additional 20 municipal clients for the firm.

Tonight's meeting begins at 4 p.m. at Town Offices.

Trustees chairperson Karen Brown said Monday there would be a public comment period at the start of the meeting, but that a nonpublic session might be called.

She said it might go nonpublic because, for one reason, she wanted "the trustees to speak freely and not worry about slandering the company."

Brown said trustees had voted to go with MacKensen & Company in July 2014 after meeting MacKensen at a conference and after talking to several people who had moved their assets.

She said she and the trustees are very happy with the performance of MacKensen & Company and said she felt their problems with the SEC were "just for advertising."
She said the town pays nothing if the firm's financial planning doesn't make money, and if they do they're only charged less than a half percent, she estimated.

She said she called the meeting just so Mayes could give his side of the story with regard to the SEC censure.

Meanwhile, the New Hampshire Attorney General's Office is doing its own investigation into whether the adverse ruling could have a detrimental effect on the New Hampshire towns MacKensen & Company represents.

Brown estimated some 29 towns had taken on the investments firm as a result of the advertising campaign that caused its censure.

"We'll make our decision whether to stay with them based on what we hear Tuesday and what the AG's findings are," Brown added.

The current balance of the trust fund is a little over $1 million, Brown said

Dionne said selectmen sometimes put nonpublic session on the agenda just in case the need comes up.

She added that the only scenarios she envisioned that could provoke a nonpublic would be if someone in the town were suing MacKensen & Company in connection with the town's trust funds or if someone was suing the town regarding those funds. She said she was unaware of any such proceeding.