The Indiana State Teachers Union has been finding trouble over the past year. In May, they asked the National Education Association to place their organization under trusteeship. This could last for 18 months. The leadership sent this posting to it's members.
'ISTA Members
As you may know, the ISTA Insurance Trust has recently experienced a number of severe difficulties. Additionally, like most organizations in this economic downturn, ISTA itself is experiencing some financial distress that must be addressed.
In a response to both of these situations, Saturday afternoon the ISTA Board of Directors met in a special session and unanimously agreed to ask NEA to institute a Trusteeship over ISTA. The purpose of this trusteeship is to assure ISTA’s current financial viability and continued long-term success.
In response, NEA agreed to appoint a trustee. His name is Edward Sullivan. Ed has had a distinguished career in the NEA family. Until his retirement last year, Ed served for 24 years as the Executive Director of the Massachusetts Education Association. I have met with Ed, and I am confident that he will provide sound leadership as we work to resolve the financial issues that confront us.
Ed will have complete authority over the operations of ISTA. As he explained it to me, his mission will be keeping the regular business operations of ISTA running smoothly while exploring various financial options for the ISTA and instituting whatever corrections are needed.
Your elected officers and the Board of Directors will give Ed full support and cooperation for the duration of the trusteeship and ask that you do the same.' (http://www.eiaonline.com/intercepts/2009/05/21/indiana-state-teachers-association-is-more-than-42-million-in-the-red/)
According to a company profiling, ISTA is a private company under the Education and Teacher Association. Headquartered in Indianapolis, it is a 155 year old organization that is the largest teacher union in Indiana.
It seems as if this union has been gambling with the funds that are used for its members services. All Unions invest their funds to get a chance at the portfolio pie, hoping it will do good for its employees. And they claim that their losses are a result of the economic bust of the last few years.
But a joint investigation by the FBI and the Indiana Secretary of State have found the regular union corruption reminiscent of the unions under mob control. On Wednesday, the Secretary of State Todd Rokita filed a complaint saying that the union has violated the Indiana Securities Act in their offering of an insurance plan to its members.
The complaint, filed in Marion County Superior Court, states that the union had mixed funds and now can not account for 23 million dollars. Among the alleged violations, the union was not registered as an investment adviser, made untrue statements and filed false reports. Under the current way the union is investing the funds, all advising for the distribution of remaining funds is to be done by a third independent party. Mr. Rokita says this filing should not affect claim payments to disabled teachers.
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