A pension fund with the savings of up to 27,000 local government workers may have lost £1.9m in an alleged $50bn (£32bn) Wall Street fraud.
US trader Bernard Madoff is on bail and under effective house arrest while the alleged scam is investigated.
The Clwyd Pension Scheme, which handles pensions for workers in Wrexham, Flintshire and Denbighshire, has investments linked to Mr Madoff.
The pension fund said it was "very concerned" the money could be at risk.
The Clwyd Pension Fund is administered on a lead basis by Flintshire County Council, and has £1.9m invested in a potentially at-risk fund.
'Deeply disappointing'
In a statement, assistant director Dave Bamber said: "The fund's exposure to Madoff is extremely small relative to other investors.
"Nevertheless, the fund is very concerned that a small proportion of its overall investments may be at risk because of this alleged fraud.
"Whilst any potential losses are deeply disappointing, they should be seen in the context of the much larger falls in the overall value of the fund as a result of the current financial crisis.
"This issue will not impact on the ability to pay pensions now and in the future and on local services and council tax bills.
"The fund's investments are held separately from the rest of the council's money."
The Welsh Local Government Association said it knew of no other local authority with money invested with Mr Madoff.
In England, Hampshire County Council stands to lose more than £7m it had tied into a fund.
Mr Madoff signed over several homes to New York's federal court to make up his $10m bail (about £6.5m).
He will also be fitted with an electronic tag and will have to seek permission to leave his flat.
He is not scheduled to make another court appearance until 12 January.
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