An investment analyst for the $5.5 billion Alameda County Employees' Retirement Association, Oakland, Calif., contends in a lawsuit that officials of the system plan to terminate him because he alleges the CIO had falsified time slips.
In the suit, filed earlier this month in Alameda County Superior Court in Oakland, Anthony Macaulay seeks job reinstatement and asks for a jury to determine damages.
Mr. Macaulay alleges that Chief Investment Officer Betty Tse improperly received more than $14,000 in unearned vacation pay in 2009 because of a “deal” with the pension fund's former chief executive officer, Charles Conrad. The agreement allowed Ms. Tse to be on vacation, even though she was listed on payroll records as being at work, court papers show.
Mr. Macaulay received a notice of dismissal on May 19, 2010, stating he was being terminated for insubordination. He was placed on paid administrative leave two weeks later after he filed an internal complaint, alleging his firing was retaliation for his allegations against Ms. Tse.
The allegations prompted the fund's board to hire an outside investigator, though the results have not been made public.
Mr. Macaulay's attorney, Steven Tidrick of the Tidrick Law Firm, Oakland, said his client wants his job back.
“The facts alleged in the complaint set forth a clear case of retaliation by Mr. Macaulay's supervisor, Betty Tse, almost immediately after Mr. Macaulay spoke up about what he saw as fraudulent activity at ACERA,” Mr. Tidrick said in a statement.
Ms. Tse and Mr. Macaulay both declined to comment. Mr. Conrad did not return phone calls.
Vincent Brown, the pension fund's new executive director, wouldn't comment on pending litigation. In a written statement to Pensions & Investments, he said Ms. Tse had gone to China for two weeks in October 2009 on personal business and then worked intermittently at home after that, overseeing ACERA investment activities.
Mr. Brown did not respond to questions about the length of Ms. Tse's absence and whether she received regular or vacation pay or was on a leave without compensation during that period.
In an Oct. 22, 2009, letter to Mr. Conrad, Ms. Tse said she would be on leave in China for up to six months and asked that Mr. Conrad act as interim CIO. There was no mention of compensation.
Several current and former ACERA staffers, who asked not to be identified, said they did not see Ms. Tse in the office between late October 2009 and early February 2010. Minutes of board investment committee meetings show Ms. Tse was not present at meetings between November 2009 and January 2010.
ACERA payroll records from late October, November and December 2009, obtained by P&I, show Ms. Tse being paid her regular salary, without any indication she was on vacation.
Before filing his suit, Mr. Macaulay attempted to take his case directly to board members.
Keith Carson, an Alameda County supervisor and pension fund board member, said in an interview that he met with Mr. Macaulay but was told by the county counsel not to discuss the matter further.
Mr. Carson referred the reporter to the June 2010 minutes of the operations committee, which disclose that Mr. Macaulay's charges would be investigated. He said the entire board wanted a comprehensive investigation.
The minutes show ACERA hired a firm specializing in employment discrimination complaints in June 2010.
Mr. Brown said the investigation has been completed, but the results are protected under California law.
“The release of this report would obstruct future investigators from obtaining candid responses and meaningful cooperation from those to be interviewed,“ Mr. Brown said in an e-mail. “The need to maintain these records as confidential outweighs the public interest in disclosure.”
Sources familiar with ACERA say while the investigation examined Mr. Macaulay's claims of retaliation, it never looked into the charges of time-sheet fraud.
Mr. Macaulay, who was hired in January 2009 as an investment analyst, maintains in his lawsuit that he received a “very satisfactory” performance rating during his 12-month probationary period. He said he applied in November 2009 to be an investment officer, and was notified in January 2010 that he had scored 97.5 on the civil service examination, ranking him second on the list to be an investment officer.
A month later, according to the suit, Mr. Macaulay brought to Ms. Tse evidence of her time-sheet misrepresentation and told the CIO such conduct was “an illegal activity. “
Shortly thereafter, disciplinary action against Mr. Macaulay — including a performance improvement plan — began, his suit says.
According to the suit, he was told by Ofelia Garrido, a human resources technician for ACERA, that he would be “excluded from promotion” and he would be “not considered a friend” unless he dropped his complaint against Ms. Tse.