Influential California State University Council Calls for CalPERS CEO Marcie Frost to Go on Administrative Leave During Investigation by Inspector General
A 7/12/2014 post by Yves on Court judgments against former CalPERS CEO Buenrostro and former CalPERS Board member Villalobos as well as damming evidence against three CalPERS board members.
“The first two payments were made in paper bags. The last installment came in a shoebox. The handoffs all came at a Sacramento hotel near the Capitol.
In a stunning admission covering years of corruption, the former chief executive of CalPERS said Friday he accepted $200,000 in cash, along with a series of other bribes, from a Lake Tahoe businessman who was attempting to influence billions of dollars in pension fund investment decisions.
Fred Buenrostro, who ran the nation’s largest public pension fund from 2002 to 2008, pleaded guilty in U.S. District Court to a charge of conspiracy to commit bribery and fraud. He has agreed to cooperate with federal prosecutors as they pursue charges against his longtime friend, Nevada businessman Alfred Villalobos, a former CalPERS board member.
Buenrostro, 64, admitted that Villalobos plied him with casino chips and a trip around the world, plus a high-paying job with his investment firm after leaving CalPERS. He also admitted working with Villalobos to create phony documents to ensure that Villalobos earned his multimillion-dollar fees representing a Wall Street private equity firm seeking CalPERS investments.
Most of those allegations had been aired publicly already. What was new Friday was the blockbuster admission that Buenrostro took $200,000 in cash from Villalobos. In his written plea agreement, Buenrostro said Villalobos paid him in three installments in 2007, “all of which was delivered directly to me in the Hyatt hotel in downtown Sacramento across from the Capitol.”
According to Buenrostro, Villalobos told him to be careful how he deposited the cash in order to avoid detection by banking authorities. “Villalobos told me to be sure to ‘shuffle’ the currency before making any deposit, as the bills were new and appeared to be in sequential order,” Buenrostro wrote.
Later, after he’d left CalPERS and the investigation into their relationship gained momentum, Buenrostro said he accepted an additional $50,000 from Villalobos, paid by check.”
Given the above and much more were proven beyond a reasonable doubt in a CA court of law, a reasonable or optimistic person may have expected Sacramento politicians to conduct an independent investigation and seek overdue reforms. So did that happen? No, the opposite did. Stausboll and Mixon, two senior calpers executives who had worked closely with Buenrostro for years, conducted a coverup by hiring and coordinating a charade whitewash by Steptoe and Johnson, that by design failed to address the extent of or any of the causes of this massive CalPERS corruption.
Why the coverup? Why the inability or unwillingness to reform then or now? Is it that CalPERS private equity and real estate general partners are the mother lode honey pot for contributions for too many Sacramento politicians to upset the status quo? Is this view accurate or overly cynical? For them, if only the honey could keep flowing quietly through back alleys without any transparency shone by Yves.