State News

Moore Defends Pension Managers as SEANC Seeks Papers

Posted March 2, 2007

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— State Treasurer Richard Moore said Friday that choosing outside managers to invest North Carolina's massive retirement funds is based on financial principles and has nothing to do with political contributions he has received.

Moore defended himself after media reports highlighted campaign donations he has received from employees of investment firms that have pension contracts and the day after the State Employee Association of North Carolina took up the issue.

"The people who have been chosen to do business with the state of North Carolina have provided good value to the people of North Carolina," Moore told reporters.

The employee group's executive director, Dana S. Cope, said in a letter dated Thursday that the members were concerned over reports that Moore had refused to turn over some records to Forbes magazine until the magazine threatened a lawsuit.

"This surprised the association and seemed inconsistent with your stated belief in disclosure and transparency regarding investment practices," Cope wrote.

Forbes carried an article in its March 3 issue headlined "Pensions, Pols and Payola" and criticizing Moore for taking the contributions while questioning Wall Street ethics.

Moore said he has no plans to return the donations because pension decisions aren't influenced by contributors.

"I'm not endorsing them. I'm not trying to get behind their motives," Moore said after giving reporters an overview of the $74 billion pension fund system, which has been ranked among the strongest in the country. "Everyone we have hired has given great value to (our) mission."

SEANC said it wants all documents related to the dispute with Forbes and an accounting of how Moore paid the law firm that he hired for the matter. The organization also asked for copies of all reports Moore has been required to file with the Legislature, a list of any required reports that weren't filed and performance reports on all pension managers' performances and how much they were paid.

Moore, a likely candidate for the 2008 Democratic nomination for governor, has received campaign donations from employees of nearly half the companies that have contracts to manage the money. Those donations—about $736,000—are equal to about 13 percent of his campaign fundraising since he first started running for treasurer in 1999.

Moore hasn't been accused of any wrongdoing. He contends that he's been open about how the retirement system operates and has listed the donors on his campaign finance reports.

"We don't have any questionable contributions," Moore said. "Both sides of the ledger, I don't think anything questionable has been done."

The state's retirement system invests for an estimated 700,000 state employees, teachers, retirees and others. It is one of a handful of public funds nationwide that are fully funded - meaning there is money available today to pay off all retirees, Moore said.

He said the funds are operated conservatively. Since taking office, Moore has won legislative approval to place a greater percentage of investments in alternative investments such as real estate and hedge funds. These funds require Moore's office to pay higher fees than indexed funds, but they can also bring larger returns.

He said his office undergoes a comprehensive process to determine who will win management contracts.

"I would never sacrifice the long-term integrity of this fund for short-term gain," he said.

16 Comments

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  • ncnurse Mar 2, 2007

    Moore did not have sexual relations with that fund......

    Dana Cope on the other hand..... Hummmmmmmm....

  • TrustMe Mar 2, 2007

    pig ain't happy until they got all four feet in the trough - just like politicians.

  • smithfielddog Mar 2, 2007

    Higher fees plus lower returns plus failure to file required returns = something fishy.

    Anyone in doubt should read the Forbes article. Judge for yourself.

    And to the person who slammed Forbes for confusing the business schools of UNC and NCSU - that was Fortune, not Forbes.

  • The Fox Mar 2, 2007

    Why does a fully funded retirement system need higher risk investments? Hmmmm.

  • superman Mar 2, 2007

    Sounds like Jim Black all over again--Why he had to hire a law firm. The state records are open to all to view-- why he didnt furnish the information to Forbes magagazine as requested. Why would he accept money from people connected to his job. He should talk to Meg Scott Phillips

  • HARDWRKR Mar 2, 2007

    We have a State Auditor. Let his office do a complete assesment of this situation and report it like it is. This sounds like another one of those "It is not illegal and therefore don't look at me" deals. Or, maybe he is like Mr. Nifong,"THE DEVIL MADE ME DO IT".

  • citizen Mar 2, 2007

    So reading the article, I gather that MORE THAN HALF the companies that manage the portfolio haven't contributed anything. Statistically this proves that making a contribution does not guarantee you will get a piece of the pie.

  • jgriffith3792 Mar 2, 2007

    Is there anyone in the state house that is honest and ethical? Is there not any integrity among these people? People complain about the way John Edwards ripped off this state when in the senate, my self included, but these people have done much more damage. Are there not any honest people that can run for office anymore?

  • nctarheel59 Mar 2, 2007

    I smell political favors and connections between the Perdue campaign and SEANC. Cope is doing more to embitter relations between the pols and the employees he is supposed to be serving. Should the laws governing political contributions be drawn more carefully? Sure!! But, Perdue's campaign has had to return campaign contributions from people connected to the Black scandal. The pension plan is FULLY FUNDED. Ask the employees in other states about their plans. Until there is proof that Moore solicited contributions before funds were managed; I think Browder is barking up the wrong tree. Wouldn't be the first time either.

  • rand321 Mar 2, 2007

    i hope the press keeps on him. He should return all the donations back and pledge to not accept more where even an appearance of a conflict could be present.

    I would have more faith in him as a potential governor if were to take the high road, fight for reform...Regardless if these contributions are legal.

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