Former fund manager says firm offered $46m to conceal VC fund strategy shift before firing him after complaints
Brookfield Asset Management faces a lawsuit from Josh Raffaelli, the former head of its venture capital arm, who claims he was wrongfully terminated after refusing to mislead investors, as reported by BNN Bloomberg.
Raffaelli filed the suit on Thursday in California state court, alleging that Brookfield offered him nearly $46m to promote a plan that would benefit the firm at the expense of investors.
Raffaelli, known for investments in Elon Musk’s ventures such as SpaceX and SolarCity, alleged that Brookfield pressured him to misrepresent the strategy behind a new joint venture called Pinegrove Capital.
According to the suit, Pinegrove — a joint venture between Brookfield and Sequoia Capital’s wealth-management arm — acquired the VC business of Silicon Valley Bank.
Bloomberg News reported in February that Brookfield had quietly closed the venture unit previously led by Raffaelli and began transferring its assets and staff to Pinegrove.
Raffaelli is not suing Sequoia or Pinegrove.
The complaint states that Raffaelli was dismissed shortly after submitting whistleblower reports internally and to the US Securities and Exchange Commission.
He alleged that Pinegrove “inflated” fundraising numbers and that Brookfield sought to deceive potential investors, including pension funds, about the implications of combining the VC funds.
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