Although Orion Township Treasurer Alice Young remains steadfast that her investments have generated interest for the Township, her investment dealings are being investigated.
The Township Board is looking into the matter, and in particular, the Township’s relationship with Royal Alliance Associates, a relationship that it is in the process of halting.
How the Township became involved with Royal Alliance takes a bit of explaining.
After attending various seminars, Young realized there were less risky investments available to the Township, that would also earn better interest.
‘When I stepped into office, I had $70 million to invest,? Young said, noting that CDs (certificates of deposit), where most of the Township’s money was invested, were said to be riskier and yield lower interest than many other options.
Because government bonds are backed by federal and state governments, they are considered to be a ‘safer? investment, according to Young.
Therefore, she took a small portion (just over 11 percent, according to her 2005 annual report), and invested in mutual funds of government bonds.
Though this particular investment had lost money on paper at the turn of the year, Young said it is important to look at the big picture.
‘What’s been lost is an unrealized loss,? she said, noting that it is only lost when the mutual funds are cashed in.
‘You go into this for the interest you earn,? Young added.
She said the mutual funds earn an annual interest of $400,000 a year.
In coming to the conclusion that mutual funds would be a smarter way to invest, Young turned to various sources for direction.
Her daughter-in-law, Diane Young, the president of the Athena Group, was hired by the Township as a consultant, a move that was approved by the Township Board.
Diane invested Township funds with her broker/dealer, Royal Alliance, just over a year ago.
Along the way, Diane received commissions on the investments, but Young said it is common for all stocks and bonds investments to earn a commission.
Young said it is actually Royal Alliance that earned the commissions, not Diane.
‘Some trickle down to her, but I have no idea how much,? she said, noting it is not common practice for the Township to ever know who is earning commissions and how much they are earning.
‘I didn’t even know there would be a commission,? said Diane, who also said she went straight to Young and the Township after learning about the commissions.
‘The Township paid no commissions,? she said. ‘The fact that they’re so concerned about this is what cracks me up.?
Diane also noted that the contract was signed by the Township Supervisor and Township Clerk, and the contract said commissions could be earned.
Diane stressed more than anything else that the commissions she earned were not coming from the Township, but rather from her broker/dealer.
She said someone is trying to make an issue out of a ‘non-issue,? and hopes the matter can be resolved soon.
Her contract with the Township was not renewed in December.
Supervisor Jerry Dywasuk said it is the Township’s ‘responsibility to investigate.?
‘We’re not making any accusations, but we are concerned,? he said.
‘We are not specialists in bonds and mutual funds and all of that,? Dywasuk said of the Township Board.
Oakland County Sheriff’s Department Lieutenant Bruce Naile, commander of the Orion Substation, would not comment on his involvement with any sort of investigation.
‘No official report has been filed with our department at this time,? he said.
Young said that all of this has been dragged out much longer than it needs to be, and she has been completely forthcoming with all of the financial information.
‘Everything I’ve done has been known by the Board,? she said. ‘I’ve done nothing illegal and nothing wrong.?
Young believes that suspicion over the Township’s dealings will only hurt the Township in future dealings, and said she has been 100 percent honest in hopes of ending any suspicions.
Young also hopes those responsible for stirring up this issue are not doing so simply to advance themselves politically.
She said she has no future political aspirations herself.
‘I am Treasurer of this Township to serve the people of this Township the best I can,? she said.