No Matching Funds For Thousands In Bright Start Savings Program

SPRINGFIELD, Ill. (CBS) — Because its Web site wasn’t updated, several participants in the Bright Start college savings program will not be getting the matching donations they expected.

Participants in the program had been told that deposits of up to $250 in a savings account would be matched dollar for dollar. The offer was limited the first 2,500 people to sign up.

But the Web site for the program was not displaying up-to-date information, and indicated that matching money was still available even after all 2,500 slots had been filled.

Now, the office of Illinois Treasurer Dan Rutherford has had to tell thousands of participants in the program that they will not be getting any matching money.

A spokeswoman for Rutherford says they’re not sure how many people were affected. The office is working with Oppenheimer Funds to figure out what went wrong.

The Bright Start program has been maligned since its inception, after many participants lost money.

The program lost nearly tens of millions of dollars, as participants invested in Oppenheimer’s Core Plus Fixed Income Strategy. The fund was believed to be a low-risk investment, but one parent, Joseph Spinoli, accused Oppenheimer in 2009 of taking “very risky bets on the mortgage derivatives” and thus losing half the money.

Then-State Treasurer Alexi Giannoulias took heat for the Bright Start meltdown, and the woes dogged him throughout his campaign for U.S. Senate last year. He ended up losing to U.S. Sen. Mark Kirk (R-Ill.)

(TM and © Copyright 2011 CBS Radio Inc. and its relevant subsidiaries. CBS Radio and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed. The Associated Press contributed to this report.)

  • Citizen for a Livable Illinois

    The State of Illinois, aka. “The Outfit”!

  • Joe Patroni

    Dan, you handled this wrong. You should have just evenly divided the funds so that it went to everybody. Some people received notice on Thursday and others Friday and into the weekend. A terrible system based on the variability of mail delivery and when folks got home from work to open the mail. You goofed on this one buddy.

  • Bill C.

    This “technical” oversight has effected numerous people. I invested as of 6:05 PM as did at least three other people I know. At that time the Treasurer’s website clearly showed spots were available. The Treasurer’s follow-up letter said all 2,500 slots had been filled by end of market close which is 3:30 PM. The lagging update on the Treasurer’s website is more than an “untimely” update process.

    I would love for one of the local news channels or newspapers to investigate how many of the 2,500 slots went to families of state employees who were informed about the program prior to the “snail mail” announcement.

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