Pa. Foundation Sues Investors Over Dwindled $2-Million Stake

A Pittsburgh-based foundation has filed a civil complaint against investors it claims misused the charity’s $2-million holding, says the Pittsburgh Post-Gazette.

The suit by the Claude Worthington Benedum Foundation, originally filed in Allegheny County court but transferred to federal court Tuesday, targets William Francis Harley III and Fursa Alternative Strategies, both based on Long Island.

The case concerns money the foundation placed in an offshore fund operated by investment house Mellon Holdings in 2005. Mr. Harley purchased the fund — through Fursa, which in 2008 reported to the foundation that the balance had dropped to about $306,000.

According to the suit, Fursa subsequently “closed the company’s offices, shut off their phone, and ceased communication” but has continued spending the foundation’s money and is now operating out of the basement of a Hooters restaurant.

The Post-Gazette said it could not reach either Mr. Harley or his lawyer.