A decision by the Ontario Teachers’ Pension Plan to withdraw from the C$52 billion ($43.3 billion) leveraged buyout of BCE in December was bad news for shareholders of the Canadian telecommunications giant. For Neil Petroff , who on January 1 became the CIO of Teachers, it may prove to be a bad omen: After all, alternatives helped boost its average annual returns to 11.4 percent from 1990 through the end of 2007, when it had C$108.5 billion in assets. BCE failed to pass a solvency test — derailing the largest LBO ever and highlighting the harsh environment Petroff, 49, faces. “There’s going to be a lot of soul searching and a natural tendency to be risk-averse that will make it hard for Neil to execute a strategy for superior returns,” says Leo de Bever, who worked with Petroff at OTPP between 1994 and 2003 (in 2008 he became CEO of the Alberta Investment Management Co.). Also unnerving was the early December arrest of New York attorney Marc Dreier after he slipped into OTPP’s Toronto offices, allegedly posed as one of the fund’s lawyers and tried to unload some bogus promissory notes for $33 million to a representative of Fortress Investment Group who thought he was dealing with OTPP. Dreier allegedly scammed institutions out of $380 million. Petroff, who has worked for OTPP since 1993, declined to be interviewed.