Following a $ 4.3 million loss resulting from an illegal investment in a hedge fund, the Hmong College Prep Academy school board appears to be backing its principal.
The board on Friday appointed a transition team whose tasks will include finding a new authorizer by June. The current authorizer, Bethel University, has said it does not want to do this work beyond 2023.
Christianna Hang and her husband, COO Paul Yang, are expected to be part of this transition team on an interim basis, pending input from CharterSource, a consultant hired last month to help the board resolve issues. governance.
“We don’t mind not being on the squad,” Hang said on Friday. “I just don’t want anyone to think there’s a conflict of interest or anything.”
In August, Bethel recommended the fire of the Hang School Board, which invested $ 5 million in the hedge fund to help pay for a college expansion for St. Paul’s School.
Bethel also issued a corrective action plan and placed the school on probation – a first step towards eventual revocation of its authorization, which would force the school to close unless it finds a new authorizer.
The call to fire Hang was a recommendation and not a mandatory part of the action plan.
Even as it begins to search for a new authorizer, the school board has started to adhere to Bethel’s action plan.
On Friday, the board removed its financial responsibilities from Hang and moved towards hiring a separate CFO, as well as a 12-month financial consultant who will report directly to Bethel.
And last month, the board hired a lawyer to investigate Hang’s $ 5 million investment with Woodstock Capital Partners. Some board members during that meeting expressed hope that the investigation will clear Hang’s name.
Hang last month asked the board to reimburse her legal fees related to this investigation and any other issues she may face in connection with the hedge fund investment. The council’s own lawyer, Jim Martin, advised against doing so and the council took no immediate action. Board member Fue Vue said on Friday that he was still seeking advice on the matter, so the board again filed the proposal.
Before discussing Hang’s request, Vue said the board had already spent around $ 100,000 on attorneys and media consultants as a result of the investment.
The school sued Woodstock in hopes of recouping its lost investment, claiming the hedge fund agreed to use safe and liquid investments that comply with Minnesota law. Woodstock denies this and blames the loss of $ 4.3 million on the global financial collapse linked to the coronavirus pandemic.
A U.S. District Court judge ruled this week that the case would go to Minnesota, rejecting the hedge fund’s offer to move it to New Jersey or Delaware.