SAN JUAN, Puerto Rico — Two unions have filed a lawsuit against Puerto Rico’s government accusing it of mismanaging employee retirement accounts.
The announcement was made Thursday by the American Federation of Teachers and the American Federation of State, County and Municipal Employees.
The unions allege the government has not created defined-contribution accounts as promised and instead invested hundreds of millions of dollars in pension contributions in accounts that earn very little interest.
A spokesman for Gov. Ricardo Rossello did not immediately return a message for comment.
The lawsuit comes as Puerto Rico faces nearly $50 billion in unfunded pension liabilities and prepares to implement pension cuts sought by a federal control board overseeing the island’s finances amid a 12-year recession. The suit in part asks that the government create individualized retirement accounts for teachers.
The Associated Press