Feds clearing decks for CalPERS fraud trial
SACRAMENTO -- Federal prosecutors appear to be clearing the legal way to speed up the trial of two former top state pension fund officials on fraud, conspiracy and obstruction charges.
A grand jury in March indicted Federico Buenrostro Jr. of Sacramento, the former chief executive of the California Public Employees’ Retirement System, and Alfred J.R. Villalobos of Reno, a former CalPERS board member and onetime deputy mayor of Los Angeles.
Recent legal filings in state and federal courts in Los Angeles County, San Francisco and Reno asked judges to grant stays, halting lawsuits involving the two federal defendants. A U.S. trustee also requested that a federal bankruptcy judge deny ending Villalobos’ bankruptcy case.
“The court should stay any further civil discovery to prevent defendants from gaining unfair access to discovery beyond that allowed by the criminal discovery rules,” wrote Special Assistant U.S. Atty. Timothy J. Lucey to U.S. District Court in Nevada.
The action, said Philip Khinda, a Washington attorney who conducted a private review of the allegations in 2011 for CalPERS, “is a sure sign that federal prosecutors are committed to bringing these defendants to justice and sending them to prison.”
Both Villalobos and Buenrostro pleaded not guilty and denied any wrongdoing.
The charges stem from a scandal that enveloped the country’s largest public pension system three years ago. Central to the investigation is the role of Villalobos as a so-called placement agent, who was paid more than $40 million in fees to help private investment firms get CalPERS business.
According to the indictment, Buentrostro and Villalobos conspired to commit fraud by creating and sending phony documents detailing payments made to Villalobos by a New York private equity investment fund, Apollo Global Management.
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