South Carolina treasurer censured by state retirement fund board
By Christine Williamson | February 28, 2013 11:51 am
South Carolina Retirement System Investment Commission, Columbia, on Thursday passed a motion to condemn and censure commissioner Curtis Loftis Jr., the state treasurer, for “engaging in false, misleading and deceitful rhetoric.”
Commissioner and Vice Chairman Edward N. Giobbe introduced a four-page motion that presented instances in which Mr. Loftis allegedly made inaccurate or misleading statements about the investment commission to various media outlets since 2011.
Mr. Loftis told the commission that he had not seen the motion prior to the meeting on Thursday, characterizing it “as the best ambush since Custer.” He denied making misleading or inaccurate statements.
“This is embarrassing to me, and as I looked around the room, to others as well,” Mr. Loftis said.
The investment commission approved the motion on a 5-1 vote, with Mr. Loftis casting the dissenting vote.
The commission oversees investment of the $26.6 billion South Carolina Retirement Systems, Columbia.
The resolution approved by the commission
Mr. Loftis' response
February 28, 2013
FOR IMMEDIATE RELEASE
Contact: Brian DeRoy – Public Affairs Director
(803) 734-2620 office (803) 733-1645 cell
STATE TREASURER CURTIS LOFTIS BLASTS PENSION FUND, VOWS HE WILL NOT BE SILENCED IN PERSUING TRANSPARENCY & ACCOUNTABILITY FOR FUND
Treasurer discusses ongoing effort to reduce SC's highest in the nation investment fees/expense burden during Thursday's Investment Commission Meeting, addresses false claims against him.
(Columbia, SC) - South Carolina State Treasurer Curtis Loftis said today he firmly rejects the Investment Commission's efforts to silence his public criticism of the commission's investment practices and its repeated refusals for information about the nature of investment practices, investment fees and contracts and other documents related to the investments. The Treasurer stated that he will continue to press for transparency and accountability by the Investment Commission and staff.
“Without necessary and timely information I cannot guarantee the existence, valuation or safekeeping of the assets, Treasurer Loftis said. “As the Custodian and a member of the Commission I am due any and all information and their refusals raise red flags about the security of the funds.
“Instead of spending public retiree resources on planning a public ambush, Chairman Williams ought to be concerned about chronic underperformance, poor external audit reports and his criminal investigation.
“Simple questions such as are investment managers or others paying for staff and Commissioner travel, why do we have contracts that pay millions of dollars more in fees than approved by the Commission and why does the Commission refuse to internally investigate an investment that has placed Chairman Reynolds Williams under criminal investigation for self-dealing.” (His law firm made $125,000 from an investment funded by the Commission)
“At the end of the day our fund makes too little money, pays too much in fees and has a portfolio that is too complex. I work for the people of SC and not for the elites on the Commission and I will never stop fighting for transparency and accountability. The people deserve to know how their money is being managed.”
The Investment Commission paid $296 million in investment fees while only making $125 million causing the plan to fall into the bottom 20% during fiscal year 2012. The fund ended the calendar year with a total return of 12.58% and a ranking in the bottom 20% in the Wilshire TUCS Master Trust Universe for funds greater than $5 billion.
“The facts are clear regarding high fees and low returns, we absolutely must put an end to sending millions of dollars in fees and expenses out of South Carolina,” Treasurer Loftis said. “This is the working people's money and we must treat it as if it is our own. I will not hold back in holding the fund and its managers accountable and will not be intimidated by a Commission Chair who happens to be under criminal investigation for his own dealings with state investments.”