The Massachusetts pension fund says it lost $12 million in investments tied up with Bernard Madoff.
State Treasurer Timothy Cahill says they have fired the investment manager, Austin Capitol, who is responsible because the firm didn't conduct the proper due diligence.
But, Cahill says the state still has $37 billion in assets, and state retirees will not be impacted by the losses.
"Although painful to lose money with any investment," Cahill says, "It will not have a negative impact on the retirees of Massachusetts."
Cahill says the impact on the pension fund was a lot less because the state has a lot of different investments.
He also says the state has made sure all its current investments are secure from getting tied up with that kind of scheme.
"That doesn't mean that there won't be frauds going forward," Cahill says. "It doesn't mean that we might not get caught up in some of them. But because we're diversified, we've limited our exposure."
Cahill says the state is going to look into litigation to get back some of the lost money.
This program aired on February 3, 2009. The audio for this program is not available.