A Los Angeles man became the first Californian today to admit guilt in connection with New York's mushrooming pension fund scandal.
The guilty plea by Julio Ramirez of the Los Angeles area tightens the connection between the New York scandal and the pension fund industry on the West Coast. His plea came in a New York court and was announced by the state's Attorney General Andrew Cuomo.
He was charged in a kickback scheme while in his former role as a "placement agent" for Wetherly Capital Group, a Los Angeles firm run by Democratic fundraiser Daniel Weinstein.
Placement agents are well-paid door openers, hired by money management firms to secure investment dollars from public pension funds. The Wetherly firm obtained $375 million from CalPERS, the California Public Employees' Retirement System, on behalf of four money managers. It also secured $50 million from CalSTRS, the California State Teachers' Retirement System.
CalSTRS and CalPERS have said they believe the investments were made properly and weren't influenced by Wetherly's actions. Still, on Monday CalPERS adopted a policy requiring money managers to disclose any fees paid to placement agents. CalSTRS adopted a similar policy in 2006.
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