CalPERS officials who received gifts may face fines
Board members and officers of the long-troubled California Public Employees’ Retirement System, the nation’s largest pension fund, could be fined thousands of dollars for not properly reporting gifts received from investment firms.
The staff of California’s political ethics watchdog agency, the Fair Political Practices Commission, proposed the fines that will be considered by the full commission Sept. 22.
Though the proposed fines are relatively small, they were a sign that a 2-year-old influence-peddling and corruption scandal at CalPERS has yet to run its course.
The commission said Monday that most of the proposed fines were for not disclosing, as required by state law, the receipt of free meals and gifts, such as bottles of wine, Rose Bowl tickets, jackets and backpacks.
CalPERS, which covers 1.3 million government workers, retirees and their families, said it cooperated with the commission’s inquiry.
“We have strengthened our reporting policies and increased training to all staff required to file to ensure our complete compliance in the future,” CalPERS spokesman Brad Pacheco said.
By law, if state government employees receive gifts worth more than a combined $50 from a single source in a year, they must report all those gifts. The maximum total value of gifts allowed in a year from a single source is $420.
The best-known names on the proposed fine list were CalPERS board President Rob Feckner of Napa and board member Louis F. Moret of Los Angeles. Each faces a proposed $400 fine for not reporting gifts of meals and drinks. The largest fine, of $3,600, was proposed to be levied on staff portfolio manager Shaun Greenwood for failing to disclose 32 gifts.
The $225-billion CalPERS fund has been wrestling with the fallout from a continuing investigation by state and federal law enforcement agencies into allegations that placement agents — freelance deal-makers who connect private investment managers with big institutional investors — earned tens of millions of dollars in questionable fees.
The state attorney general’s office is pursuing a lawsuit against one agent, former CalPERS board member Alfred J.R. Villalobos, who is accused of committing securities fraud, selling securities without broker dealer licenses and violating state unfair competition laws. Also named in the suit was former CalPERS Chief Executive Federico Buenrostro Jr., a two-decade associate of Villalobos.
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