California ethics watchdog probes Calpers on gifts

SAN FRANCISCO Tue May 24, 2011 8:54am EDT

Calpers mission statement is seen posted on the wall in the regional office in Sacramento, California, October 21, 2009. REUTERS/Max Whittaker

Calpers mission statement is seen posted on the wall in the regional office in Sacramento, California, October 21, 2009.

Credit: Reuters/Max Whittaker

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SAN FRANCISCO (Reuters) - A California ethics watchdog agency is investigating the board president, the chief investment officer, and other current and former officials and employees of Calpers, the biggest U.S. public pension fund, over disclosure of gifts.

The California Fair Political Practices Commission is looking into whether officials and employees at Calpers failed to properly report gifts they had received or had received gifts whose value exceeded a state limit, Roman Porter, the commission's executive director, told Reuters on Monday.

Porter declined to provide details on the probe, noting it is open and that Calpers, the California Public Employees' Retirement System, is cooperating with the commission.

Among those named in the probe are Calpers board president Rob Feckner, fellow board members George Diehr and J.J. Jelincic and fund Chief Investment Officer Joseph Dear.

Also on the list is former Calpers Chief Executive Fred Buenrostro, who has been named in another probe involving placement agents that has dogged Calpers in recent years. He has denied any wrongdoing.

The scandal at Calpers involving the agents, who help investment managers sell their services and products, prompted the fund itself in 2009 to begin looking into whether its employees had been properly recording and disclosing any gifts from those seeking business relationships with the fund.

Calpers Chief Executive Anne Stausboll said in a statement that the fund's own probe has been looking back several years.

"As we learned about apparent misconduct, I issued a request to Calpers staff" to review records since 2005. "Approximately 35 members of our staff voluntarily filed amended documents," Stausboll said.

"Calpers has been fully cooperating with the FPPC on this investigation over the last several months. These matters are still pending and our staff involved have due process rights," Stausboll said, noting the commission is looking at about 50 individuals associated with Calpers.

State Controller John Chiang, a member of Calpers' board, is promoting more stringent gift legislation aimed at those seeking business at California's pension funds, which the fund is supporting, Stausboll said.

Calpers did not immediately respond to requests for comment from it and its officials. Buenrostro could not be reached for comment.

(Reporting by Jim Christie; Editing by Phil Berlowitz)

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