There is a war going on between the State Treasurer’s office and the South Carolina Retirement Commission.
Here are the emails. Enjoy the corridors of power in action:
Here are the players:
Curtis Loftis, State Treasurer with solid Republican creds, Tea Party connections, and Mitt Romney’s endorsement, among many others. He’s a Club For Growth darling, businessman, and philanthropist. He claims to be big on transparency, financial literacy, and more efficient government.
And that’s about it. You see, the other side quit. COO Daryl Oliver resigned, alleging Loftis cussed him out. Loftis accused Oliver of threatening him. Sound like Myrtle Manor? It gets worse. The mud slinging resulted in rough comments from the Treasurer:
“The Chairman has good reasons to hide behind the cloak of secrecy. He wants to hide that we pay over $300 million a year in investment fees to Wall Street. He wants to hide that South Carolina is ranked in the top 10% of highest investment fees in the nation while our returns regularly rank in the bottom 25%. He wants to hide that $1.4 million in bonuses were paid to fourteen staff members, including an employee who received a $300,000 bonus on top of his $300,000 salary while the pension underperformed.”
The Treasurer’s office cites some rather disturbing statistics about how this pension fund is being run:
- $750 million of unreported investment fees and expenses;
- $300 million a year in investment fees and expenses paid to Wall Street;
- Pay top 10% of investment fees and expenses in the nation;
- Routinely rank in the bottom 25% in investment performance;
- $1.3 billion in unachieved returns due to below average investment returns over 3 years;
- $1.4 million in bonuses awarded to 14 staff.
- Rank in the top 10% for bonuses awarded despite mediocre performance;
The State Retirement folks say they are an independent entity that is not under the purview of the State Treasurer, and that is a good thing. Less political influence makes for better investments.
It would be funny were it not for the fact that we are talking about the retirement funds of a lot of people who worked for decades in the state system.
Who is right? Stay tuned. Regardless, it is time for a thorough, non-partisan, independent investigation.