TMI Investors to Recoup Some Losses

Educators who lost their retirement savings in the 1994 collapse of Teachers Management & Investment Corp. will get back about 23 cents on the dollar, a court-appointed receiver said. Dennis B. Schmucker of San Diego said teachers and administrators who had invested $280 million in real estate partnerships put together by TMI probably will receive only about $65 million back from settlements and property sales. Unfortunately for 20,000 teachers statewide, Schmucker said, “the biggest chunk of the loss was caused by the decline in the real estate market,” not the alleged wrongdoing of TMI and its owners, auditors, lawyers and bankers. An Orange County judge tentatively approved the $14-million settlement with TMI’s auditor, KPMG Peat Marwick accounting firm, and banker, Comerica Bank-California. KPMG agreed to pay nearly $10 million and Comerica agreed to pay more than $4 million to end litigation stemming from TMI’s collapse.