The Internet bust is coming back to haunt TH Lee Putnam Ventures and Merrill Lynch Alternative Investments. The Festus and Helen Stacy Foundation has filed a claim with the NASD against MLAI, but says both firms passed on inaccurate information regarding investments in a portfolio that was losing money, according to VentureWire Professional, citing people close to the matter. In its complaint, the Florida charity says that, had it known the value of the TH Lee Putnam portfolio was sinking, it would have stopped putting money in it. In a related matter, Stacy has filed a petition in a federal district court in Georgia to force Putnam to turn over records that would expose the true value of the funds. VentureWire reports that Stacy kept putting money in the portfolio for almost two years before realizing there were "contradictions" in the performance reports. The foundation says, for example, that nearly one-third of the 37 portfolio companies that Putnam financed were out of business or had zero value, while the remainder held on to nearly 92% of their value. "There was a discrepancy with reality," Wendell Bird, an attorney for the foundation told VentureWire, about the unlikelihood that some companies could be valueless while the others can be doing so well. An NASD arbitration hearing is set for next month.