Majorchangestopensionfundproposed
BySHERRYHALBROOK Cuomosaid,“Thesoletrusteemodel contributiontoanypensionfundtrustee
L
PEFisoftwomindsaboutproposals hasallowedpay-to-playtoflourishina orcandidateforthatpost.Thefirmsalso
E
tochangethestatepensionlaw. systemmeanttoprotecttheretirement wouldbebarredfrommakingimproper
G
Theunionhasseriousreservations accountsofthousandsofhard-working giftsorjobofferstopublicpensionfund
I
aboutanewlegislativeinitiative, publicemployees.” employeesandofficials.
S
announcedinearlyOctoberbystate Thebillwouldrequirerigorousand
L
AttorneyGeneralAndrew Opentodiscussion continuingdisclosureoftheidentities,
A
Cuomo.Hewantstoend StateComptrollerTom responsibilitiesandqualificationsof
T
thestatecomptroller’s DiNapolisaidhe investmentfundpersonnelandany
I
V
roleassoletrusteeofthe welcomesboththe paymentsbyinvestmentfirmstothird-
statepensionfundand proposedreforms,which partiesinconnectionwithpublicpension
E
givethatresponsibilityto wouldcodifysome fundmatters.Investmentfirmswouldbe
a13-memberboardof measuresalreadytaken, requiredtopromptlypublishsuch
A
trusteeschairedbythe anddiscussionsofthe informationontheirWebsitesand
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comptroller. proposaltocreateaboard annuallycertifytheircompliance.
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Atthesametime,PEF oftrusteestorunthe TRUSTcreatestoughnewcivil,
I
supportsprovisionsinthe
CUOMO
fund.
DINAPOLI
criminalanddisciplinarypenaltiesand
O
legislationaimedat “It’sbeenalong sanctions,andrequireslicensed
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eliminatingcorrupt struggletorepairthe professionalstoreportevidenceof
practicesdiscovered damagetheHevesi violations.Italsoallowscriminal
earlierthisyearcalled“paytoplay.” administrationinflictedonthestate prosecutionforthetheftofpropertyand
“Historically,wehaveheldtheelected pensionfund,”DiNapolisaid.“Overthe servicesfromtheretirementsystem,and
comptroller,assoletrusteeofthefund, pasttwoandahalfyears,I’veusedmy extendsthestatuteoflimitationsfor
providesmorepublicaccountabilitythan authorityastrusteetoinstitutealonglist personsactinginconcertwithpublic
spreadingthatresponsibilityoverapanel ofreformstothemanagementofthe servants.
ofappointedtrustees,”saidPEF pensionfundtolimittheopportunityfor TRUSTwouldcodifythePublic
PresidentKenBrynien.“However,PEFis corruption. PensionFundReformCodeofConduct
veryinterestedinproposalstomore DiNapolisaidhehas:bannedtheuse createdbyCuomoearlierthisyear.So
effectivelyprotecttheintegrityofthe ofplacementagentsandlobbyistsinfund far,TheCarlyleGroupandsixother
CommonRetirementFundandits investments,adoptedpoliciestostoppay- investmentfirmshavesignedontothe
investments.” to-play,increasedtransparencyand code.
Mostrecentlyvaluedat$116.5billion, accountability,andlimitedcontributions “Thesefirmscollectivelyhaveagreed
theNYSCommonRetirementFund tohisowncampaigntolessthanhalfthe toreturnnearly$60millionassociated
supportstheretirementsof legallimit. withNewYorkStateCommonRetirement
approximatelyonemillionstateandlocal Fundinvestments,”Cuomosaid.
governmentemployeesandteachers. Buildinglegalfirewall Hesaidheuncovered“acomplex
Thefundhassufferedhuge OnekeyareaofreformintheTRUST criminalscheme...underformer
investmentlossesfromthestockmarket proposalisabanoninvestmentfirms ComptrollerAlanHevesi,inwhichthe…
collapsethatbeganlastyear.Itwas using“placementagents,”lobbyistsor pensionfundwasusedasapiggybank
rockedearlierthisyearbycriminal otherintermediariestointeractwith forthecomptroller’schiefpoliticalaide
indictmentsrelatedtofundmanagement publicpensionfundsforanypurpose. andafavorbankforpoliticalalliesand
andtheconvictionofformercomptroller Investmentfirmsandtheirprincipals, otherfriends.”
AllenHevesi,whoresignedandpled agents,employeesandfamilymembers Californiaandsomeotherstatesthat
guiltyin2006tomisuseofstaffatthe wouldbebannedfromdoingbusiness useappointedboardstoruntheir
OfficeoftheStateComptroller(OSC). withapublicpensionfundfortwoyears pensionfundshaveexperienced
afterthefirmmadeacampaign corruptionproblemstoo.
MatterofTRUST
Thelegislation,announcedjointlyby
Cuomoandthreemembersofthestate
Senate,istitled“Taxpayers’Reformfor
UpholdingSecurityandTransparency”
“
Historically, we have held
the elected comptroller as
(TRUST).Itwouldinstitutionalize
Cuomo’sPublicPensionFundReform
sole trustee of the fund
CodeofConduct,thatheannounced
earlierthisyear,andprovideadditional provides more public
civil,criminalandadministrative
penaltiesandsanctionstoensurefirms
accountability than spreading
andindividualsareheldaccountablefor
violationsofit.
that responsibility over a
Thebillalsowouldprohibitpay-to-
panel of appointed trustees.”
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