Atlanta General Employees' Pension Fund will hire a firm to conduct a forensic audit of its investment consultant, Gray & Co., and the pension fund's alternatives investments, confirmed J. Anthony Beard, the city's chief financial officer and member of the board of trustees.
“There's been a lot of media coverage of Gray & Co. in the last month or two, and the city wants to make sure it handles its responsibilities as fiduciary of the fund,” Mr. Beard said in a telephone interview.
The pension fund made its first alternatives commitment late in 2012, following passage of a law in April 2012 that allowed most public retirement systems in Georgia to invest in alternatives.
Trustee Angela Green filed a complaint with the Securities and Exchange Commission earlier this year arguing that Gray & Co. did not adequately reveal to the board that it was the manager of a private equity fund called GrayCo Alternative Partners II, to which the board had approved a commitment of up to $28 million in November.
Mr. Beard said the board will hire an auditing firm. “Hopefully (this) will fall under what we would call a small procurement so it won't require a full RFP,” Mr. Beard said.
The pension fund currently has an RFP posted for an investment consultant, following the expiration of Gray & Co.'s contract on Dec. 31, 2010. Mr. Beard reiterated that Gray & Co. is invited to rebid. Proposals are due at 1:59 p.m. on Oct. 1.
Yolanda Waggoner-Foreman, co-CEO at Gray & Co., did not return a phone call for comment by press time.
