Alfred Villalobos, an ex-CalPERS board member who brokered a $3 billion investment to funds managed by Apollo Global Management, was indicted on a new charge of conspiracy to commit bribery, U.S. prosecutors said.
Mr. Villalobos conspired with ex-CEO Federico Buenrostro, who pleaded guilty in July to steering $14 million in placement fees to Mr. Villalobos in exchange for cash bribes and gifts, according to a revised grand jury indictment filed Thursday in U.S. District Court in San Francisco. Mr. Buenrostro has agreed to cooperate with the government's investigation.
Mr. Buenrostro gave Mr. Villalobos access to confidential information on investments of the $298.4 billion California Public Employees' Retirement System, Sacramento, and advised the board to make financial decisions that would benefit Mr. Villalobos and his clients, according to Mr. Buenrostro's plea agreement.
In return, beginning in 2005, Mr. Buenrostro accepted $250,000 in payments, plus gifts, domestic and international travel, meals and entertainment and funds for his wedding.
Mr. Villalobos founder and managing director of Arvco Capital Research LLC, was first charged last year with conspiracy to defraud the U.S. and mail and wire fraud conspiracy. He pleaded not guilty to the charges. Bruce Funk, an attorney for Mr. Villalobos, didn't immediately respond after regular business hours to a voice-mail message seeking comment.
A CalPERS board member from 1993 to 1995, Mr. Villalobos allegedly acted as a placement agent in helping Apollo to secure investments by CalPERS in 2007 and 2008, prosecutors said.
Apollo required Arvco to obtain an investor disclosure letter from CalPERS before paying fees for securing the investments, they said. After CalPERS' legal and investment offices declined to sign a letter, Messrs. Villalobos and Buenrostro allegedly conspired to create a series of fraudulent letters that were transmitted to Apollo in 2008 and 2009, according to the indictment.
