Another CalPERS Scandal Coming at the Wrong Time

From the Sacramento Bee: Retired police officer Steve Landi complained to the California Public Employees’ Retirement System back in 2016 that his police chief was working full-time earning thousands a month while illegally collecting retirement benefits. A CalPERS audit team finally arrived in May 2021. Last month, it said that, sure enough, Landi’s boss, Broodmoor Police Chief David Parenti was one of three police chiefs and a top commander in the department that defrauded the pension system for a decade, together collecting as much as $2 million. It was one of the largest abuses of retirement benefits in years — so egregious that the local district attorney is considering criminal charges.

It also raises a question for Landi as well as Parenti’s two successors: Why did it take CalPERS so long to figure it out and take action? “They were lining their pockets for years,” said Landi, who joined the department in 2015 after retiring from the San Francisco Police Department. “It’s corruption at its finest.” 

CalPERS is a retirement system like no other in the U.S. It covers state employees but also the workers at some 3,000 municipalities, school districts, authorities and other governmental entities. More than 650,000 retirees and another 1 million or so current employees are covered by CalPERS. 

A FAILURE TO COMMUNICATE 

Broadmoor was under scrutiny by CalPERS for failing to enroll some officers in the pension fund at the time, but not for the chief’s double dipping. That suggests to former insiders such as J.J. Jelinic that the CalPERS division that monitors employee enrollment issues has little coordination with another unit assigned to examine double-dipping and other violations of state retirement law. “The right hand doesn’t know know what the left is doing,” said Jelinic, a former CalPERS investment staffer and board member...

Full story at: https://www.sacbee.com/article257232847.html.

You could ask what relevance this CalPERS scandal has to UC, which is not part of CalPERS and which has its own separate pension system. The problem is that CalPERS - which has a propensity for bad management and scandals - tends to tar public pension systems, including UC's, more generally. Recent adverse moves in the stock market suggest that all pension plans will be showing poor results unless the market quickly recovers. Issues of pension finance and unfunded liabilities will come to the fore again. UC tends to be caught up in the political problems of CalPERS (and CalSTRS), even though it is totally separate and doesn't have a history of scandals and bad management. That's the relevance.