BOISE, Idaho (AP) — A pension fund trustee and investment adviser from Idaho who made a $40 million bid to buy a failed ski resort was arrested Wednesday on charges of raiding pension funds he was hired to oversee.
Matthew Hutcheson, 41, of Eagle, was arrested by FBI agents at his home on the same day a federal court unsealed a 31-count indictment accusing him of 17 counts of wire fraud and 14 counts of misappropriating pension funds.
Hutcheson, who served as a trustee and fiduciary for national employer pension funds, is accused of scheming to misappropriate more than $5 million in assets from two funds starting in 2010.
The indictment claims he used the money in his unsuccessful effort to buy the Tamarack resort and for personal gain, including paying for renovations to his 4,900-square-foot home and buying luxury cars and motorcycles.
"We take allegations of pension fraud very seriously," said U.S. Attorney Wendy Olson.
Hutcheson's attorney Dennis Charney said he was still reviewing the indictment but challenged allegations that his client misused pension funds to pursue the resort in a deal that eventually fell through.
The indictment accuses Hutcheson of using $3.2 million from the Retirement Security Plan & Trust pension fund to buy a bank note and interest in the golf course at Tamarack.
"As a fund manager, he has full discretion to make investments," Charney told The Associated Press. "Sometimes those investments turn out positive and sometimes negative. There is no fund manager out there who hasn't made an investment that didn't go south."
In November 2010, Hutcheson emerged from nowhere to announce he was offering to pay $40 million to buy the troubled resort outside Donnelly, located in the central Idaho mountains 90 miles north of Boise.
He formed a company called Green Valley Holdings LLC to negotiate the acquisition and assembled a team to attract investors and develop a strategy to resurrect the resort that took a beating during the economic recession and decline in real estate values.
Tamarack's original investors defaulted in 2008 on a $250 million loan from a lending group led by Credit Suisse, creating a scenario in which Hutcheson or other investors could try to buy the resort and its assets at a bargain. Tamarack is currently going through foreclosure litigation in an Idaho state court.
At the time he was trying to buy the resort, Hutcheson relished the role of rescuer — not just for the resort but also for the region where it was located.
"I'm on a humanitarian mission for the people of Valley County," Hutcheson told the AP in an interview last year.
Ultimately, Hutcheson's plans crumbled, in part because he failed to attract investors. Then in August, two actuaries from Washington state complained to the U.S. Department of Labor about Hutcheson's handling of $1.9 million in G Fiduciary, a retirement plan where Hutcheson had served as a trustee.
According to the indictment, Hutcheson used $2.1 million in G Fiduciary assets for his personal use. Investigators contend Hutcheson, in 12 separate wire transfers, had the money deposited into bank accounts.
The indictment claims he then paid a contractor $892,000 to remodel his home inside and out, including a 4,100-square-foot barn, swimming pool, hot tub, secondary garage, dog house and landscaping. Hutcheson is also accused of using $366,000 to repay two personal loans, spending another $93,000 on three vehicles and $15,000 to buy a pair of motorcycles and two all-terrain vehicles.
Authorities say he engaged in a similar scheme to transfer more than $3.2 million from the Retirement Security Plan & Trust, a Texas-based program serving 500 members with more than $19 million in total assets.
Investigators claim Hutcheson withdrew money from the fund in December 2010 and deposited it into an escrow account set up for Green Valley Holdings. Investigators say Hutcheson then used the money to buy the bank note for the Osprey Meadows Golf Course and Lodge but later lied to auditors who questioned him about the money.
The indictment recommends that Hutcheson be ordered to forfeit more than $5.3 million in cash or assets. Each count of wire fraud is punishable by up to 20 years in prison and fines.
Hutcheson is being held in the Ada County Jail until his scheduled appearance Thursday in U.S. District Court in Boise.