North Carolina Treasurer Janet Cowell has come under fire for the management of the NC Retirement benefits systems. The claim is that there is a $30 billion dollar secret fund that exists within it. Cowell has flatly denied this allegation. The man making that allegation is Edward Siedle. BizJournals explains:
State Treasurer Janet Cowell not only rejects claims that $30 billion in secret funds exist within the North Carolina Retirement System, but she and her office also question the legitimacy of the organization making the accusation.
Pension forensic investigator Edward Siedle has been vocal in his accusationsthat Cowell and her office cut secret Wall Street deals – a claim Cowell has denied. Via a 145-page report commissioned by the State Employees Association, Siedle and his firm, Benchmark Financial Services, accuse Cowell of flat out breaking the law.
Evil Wall Street 1% type argument being made here or something more locally political? Perhaps Siedle is a subscriber to the “99%” Occupy theme? Or perhaps this has more to do with keeping Cowell from possibly interrupting Attorney General Roy Cooper’s bid for Governor? SEANC used a similar move to discredit Richard Moore during his bid for Governor, why not go to the same well for water twice?
Siedle seems awfully cozy with SEANC, who requested the audit. Coincidentally, the big case Siedle keeps comparing North Carolina to took place in Rhode Island, where a public employee union was also the initiator of the investigation. Is it also coincidence that Siedle’s report looks to be a copy and paste job of another report done in the Rhode Island investigation?
As for that one-size-fits-all complaint, SigRist, in an appendix, cited nearly 50 paragraphs in the 147-page report that contain similar or identical language to a blistering report Siedle wrote about the employees pension fund in Rhode Island.
A number of those paragraphs are, to be sure, general overviews, such as one that discusses a Bloomberg Businessweek cover story on hedge funds and another noting that, six years ago, famed investor Warren Buffett wagered $1 million that hedge funds would not beat the S&P 500. But more than a dozen paragraphs are essentially the same except for substituting TSERS (North Carolina’s Teachers’ and State Employees’ Retirement System) for ERSRI (the Employee Retirement System of Rhode Island). – News and Observer, 6/10/14, “NC treasurer’s office rips SEANC-funded report”
Sougata Mukherjee of the Triangle Business Journal seems to think the Siedle report is also a bit lacking and thinks Siedle has not revealed a ‘smoking gun‘. Mukherjee’s article also makes the point that the Treasurer’s annual report does not contain all the line item fees. One should perhaps consider my earlier question as to SEANC’s motive with regards to AG Cooper as the reason for Siedle’s investigation on behalf of SEANC if line item fees are what Siedle is hanging his allegations on.
Cowell, smartly, is not relying on Siedle or SEANC to continue a solo investigation. Cowell has put together an 11 person commission to investigate the structure of the pension program.