California Treasurer Paying “Close Attention” to CalPERS’ Carried Interest Drama


California state treasurer John Chiang said he is paying close attention to the ongoing saga surrounding CalPERS and its recent efforts to disclose how much it pays in “carried interest” fees.

Last month, CalPERS acknowledged it did not track how much it paid in “carried interest” fees to private equity firms. Shortly after that admission, the fund launched an effort to gather the data.

More on Chiang’s comments from the Financial Times:

One of California’s most senior elected officials has voiced “great concern” at Calpers’ worrying admission that America’s largest public pension scheme has no idea how much it pays its private equity managers.

John Chiang, state treasurer of California, told FTfm he will demand clear answers from the $302bn pension plan over why it does not know how much has been paid in “carried interest” or investment profits over a period of 25 years to the private equity managers running Calpers’ assets.

The attack comes just weeks after US regulators issued an explicit warning to the private equity industry to expect more fines for overcharging investors….

“This issue is of great concern to me,” said Mr Chiang, who is a known reformer and also sits on Calpers’ administration board. “This will have my close attention until it is solved.”

In an unrelated shift in investment policy, CalPERS has for months been whittling down its private equity managers by 66 percent.


Photo by  rocor via Flickr CC License

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