A former Wesleyan University investment director is accused of using tens of thousands of dollars in endowments to pay for personal trips and other non-university expenses, including a family trip to Europe to interview for another job.
Attorney General Richard Blumenthal has filed a lawsuit alleging that Thomas Kannam failed, while serving as Wesleyan’s chief investment officer, to disclose his ties to multiple investment groups, including Belstar Group, LLC, Vietnam Capital Partners, LLC and Advanced Device Technology, Inc., and then using university assets to help those businesses.
The suit accuses Kannam of violating the state Solicitation of Charitable Funds Act by misusing assets meant to benefit of Wesleyan’s charitable and educational purposes,
Blumenthal also named the companies in the suit.
The misuse of fund, Blumenthal said, are a “golf outing of the century” in California, a Super Bowl trip, and a trip to interview for a job at Cambridge University.
“Wesleyan staff and assets were allegedly treated as personal fiefdom -- abused and misused for private gain,” Blumenthal said. “Our lawsuit seeks to recover every dollar diverted from Wesleyan University’s charitable assets by its former investment chief. This misuse of Wesleyan’s endowment resources deprived all Wesleyan students and staff of potential resources.”
Kannam served as Wesleyan’s director of investments from December 1998 through 2005, when he was promoted to serve as Chief Investment Officer –one of the university’s most highly compensated employees. The university terminated him in October 2009. University officials said that came after an internal investigation
As a condition of employment, Kannam was prohibited from serving in any other positions or on boards, compensatory or otherwise, without permission from the university president, Blumenthal said.
Stephen Fitzgerald, Kannam's lawyer, told the Associated press that Kannam's contract with Wesleyan allowed him to do outside work.
In 2006, Kannam became involved with Belstar and eventually became an owner of director of investment for the company – never disclosing his affiliation with Belstar to the university, Blumenthal said.
Beginning in 2008, Kannam also began serving on the board of Vietnam Capital Partners, which Wesleyan officials did not know about. The company operates the Vietnam Equity Growth Fund, which is a $250 million hedge fund investing in the public and private equity markets of Vietnam, Blumenthal said.
On several occasions, Kannam also provided lobbying and other services on behalf of his father’s corporation, Advanced Device Technology and billed the university for at least two trips to Washington, D.C. that were made on behalf of ADT, involving little to no university-related business, Blumenthal said.
Martin Stein, a lawyer for Belstar, said the lawsuit has no merit and the company expects to be vindicated.
The school also brought an action against Kannam to recover damages and said they would help in Blumenthal's investigation. School officials said they could not comment further because of ongoing legal proceedings.