OCERS Retirement Board Appointment runs into trouble
October 6th, 2008, 3:58 pm · 22 Comments · posted by NORBERTO SANTANA JR.
Supervisor John Moorlach’s proposed appointment of Thomas Flanigan to sit on the board of the Orange County Employees Retirment System is sending up a significant amount of dust.
The Board of Supervisors was scheduled to consider the appointment at tomorrow’s meeting. Yet amidst calls to delay action, it looks like Moorlach is pulling back on the issue. He pulled his nomination off the agenda about 3 p.m., while we were working on this item.
So far, there are questions whether Flanagan - who was let go as OCERS Chief Investment Officer in 2005 - has a problematic relationship with a company - Ryan Labs Inc. - selling investment products to retirement systems.
Under a newly-adopted state law (Assembly Bill 246), those serving on public pension boards aren’t allowed to sell investment products in which they have a stake.
My colleague on the investigative team, Tony Saavedra, has uncovered more about Flanigan’s past - which includes being let go by three separate retirement systems over the last decade.
This morning, Nick Berardino - head of the county’s public employee union - sent off a letter to Moorlach and others questioning Flanigan’s connections to Ryan Labs Inc., which sells investment products to retirement systems.
Ryan Labs President Sean McShea left me a voicemail this morning saying, “He’s just doing some extra credit for us. There’s no contractual obligation. I’m not sure there ever will be.”
When I spoke with McShea - who was kind enough to return my call - he said that Flanigan is a “prominent national public pension fund speaker” and called him “a friend of the firm for 20 years.”
McShea wasn’t exactly clear on what “extra credit” meant but he expressed that Flanigan is a nationwide authority on pension investments.
Saavedra has found that Flanigan’s employment history is marked by forced resignations with the state of Connecticut and OCERS, the very same agency that he is now being asked to help steer.
Moorlach said he regarded Flanigan’s resignations as a badge of courage for swimming against the investment current with his conservative strategies.
“You’ve got a guy who understands when the market is telling you you should be getting out of things,” Moorlach said. “Tom is an icon in the industry. He’s got a lot of friends and he’s got some enemies.”
Moorlach said Flanigan’s ideals ran counter to his bosses at the California State Teachers Retirement System, where he left in 1997 after 12 years as chief investment officer when his contract expired.
Flanigan later became head investor for the $22 billion Connecticut Retirement Plans and Trust Funds, but was dismissed according to media reports in 2000 after less than two months.
State Treasurer Denise L. Nappier told Pensions & Investments publication, “Unfortunately (Flanigan’s) approach to communications and administrative process proved to be inconsistent with my own.”
Flanigan had been hired to help heal a damaged pension system in which the previous treasurer pleaded guilty to federal charges of racketeering and money laundering.
In 2005, Flanigan was asked to resign as chief investment officer of OCERS because of differences with the board. Moorlach, who was on the panel at the time, sided with Flanigan.
“His maverick component wasn’t sitting well with some board members,” Moorlach said.
Flanigan chalked up his departures to a difference in philosophies.
“This is a different world, the model is changing as we speak,” Flanigan said. “I (work) 25 hours a day to protect the taxpayers and their pensions.”
October 6th, 2008 at 5:15 pm
The term “Maverick” is a bit over used in this case. It looks like a New York investment firm wasn’t quite truthful when describing its relationship with Flanigan and it doesn’t look like Flanigan was truthful when describing his relationship with the firm. This kind of double talk is becoming very familiar from these New York investment guys. It will be interesting to see how this board deals with this situation.
October 6th, 2008 at 6:12 pm
Does anyone else smell something rotten here?
Moorlach is pushing to make another appointment close on the heals of replacing long-term OCERS trustee Tom Lightvoet. On top of that, Flanigan was FIRED from OCERS while Moorlach was on that board. Why would he want to assign him now as a trustee?? Does the term “stacking the deck” come to mind?
Just another example of poor leadership - AGAIN. Let’s wake up and smell the burning brakes! Moorlach, at his own whim, is driving the county with reckless abandon.
October 6th, 2008 at 6:45 pm
Whew!! Sounds like a clonisum here. The Board treats OCERS like its own little treasury. They place their friends at the helm and remove anyone who might have a different perspective. Why not charge the employees more, lets change the actuarial numbers. Who cares about the little guy.
The appointment of Flanigan again shows the Board’s lack of critical thinking and lack of understanding of the LAW. Have you heard about the law of conflict of interest Mr Moorlock? You and your cronies on the Board are setting the County up for lawsuits with this kind of decision.
Get real….show some leadership for a change.
October 6th, 2008 at 7:29 pm
This sounds like BUSH saying “Brownie, your doing a heckuva job!” Flanigan gets forced out of jobs, and fired from one and MOORLACH calls him a “Maverick”! and wants to appoint him to the board? This is not what we need on the OCERS board!
October 6th, 2008 at 7:37 pm
Apparently the Board is more concerned with securing a position on the OCERS Board with someone who places employees near the bottom of the totem pole than they are with finding a qualified person to represent the interest of those same employees. In their expedient quest to place an anti-employee on the board they forgot to insure he was legally qualified. For shame! But then again here in the OC we would call that “business as usual”. Thanks, but no thanks.
October 6th, 2008 at 7:49 pm
An appointment as important as this one deserved more thoughtful consideration and investigation to ensure that there were no conflicts or violations of the law. Failure to do so was irresponsible at the very least and unlawful at the very worst if the appointment was made knowing there was a conflict or violation of the law. The fact that “This is a different world..” as Mr. Flanigan indicates does not give license to subterfuge and cronyism.
October 6th, 2008 at 8:26 pm
Why rehire someone who was just fired three years ago? Flanigan has obviously shown a pattern of conduct that is not appropriate as a Trustee on any Retirement Board. Who will this benefit?
With all of the recent economical problems in the United States, the Board of Supervisors has a fiduciary responsibility to appoint the best possible candidate for the job. Not just one that Moorlach feels he can push around to vote his way and only Moorlach’s way–against public employees.
October 6th, 2008 at 8:37 pm
This is a typical Wall Street play…make friends with politcos and get your products in. You can see the cover-up brewing…..he was doing extra credit for us….”. He was probably doing extra credit for others and that is why he was fired from three retirement systems. Don’t trust him or the politicians on investment matters anymore.
October 6th, 2008 at 9:17 pm
In case it’s escaped anyone’s attention, there’s an economic catastrophe going on, precipitated by unrestrained “free market” proponents whose only objectives have been exposed to be self promotion, self interest, and self profit. Now the Board of Supervisors threatens to install yet another proponent of the discredited present, his conflicts of interest clearly exposed, to oversee County pension funds. During these legitimately frightening times we cannot afford, and will not abide, even the slightest threat of self interest when it comes to the stewards of our finances. This potential appointee is a three-time loser who has $$$ to make at the public trough. Please, Board members, act responsibly and reject the appointment of this profiteer.
October 6th, 2008 at 10:06 pm
I’ll tell you, I don’t what kind of lyin’ libretarian crud has hijacked my beloved Republican Party, but these guys need to be out of office! This guy they’re appointing not only sounds like a loser, but once again the Register has caught the whole lot of them, Moorlach, Mainero and appointee, lying through their teeth!!
Talk about the greed and corruption on Wall Street, what about appointing consultants to serve on a pension system in our backyard that my OC taxes paid for!
October 6th, 2008 at 10:13 pm
The thing I love about this is that we elect our Board of Supervisors, in part because they serve a “watchdog” function. But the only “watchdogs” I see here are the employees union and The Register!
October 6th, 2008 at 10:32 pm
Will someone at the Register please investigate Moorlach’s and Street’s SIV/CDO speculations that are worthless.
October 6th, 2008 at 10:39 pm
Do as I say, Not as I Do. I’m not surprised…..
October 6th, 2008 at 10:49 pm
So, Moorlach makes it look like he is a hero by pulling back his appointment of Flanigan. What a hoot. Can anyone say Chriss Sstreet?? This guy is worse than Carona when it comes to surrounding himself (stupidly) with his buddies who then melt down on him. Hmmm…. I wonder if anyone has really checked into Mario’s background. Maybe a job for Sheriff Hutchens.
October 6th, 2008 at 10:53 pm
This appointee sounds like a nut who can’t hold a job! And then to top it off Moorlach and company lie about it. Like “Impeach” says, let’s see what else these guys are lying about.
October 6th, 2008 at 11:31 pm
Just what we needed in Orange County: another bad apple! You know it is amazing how we hold that positions in authority should set their standards higher and those in authoroity in Orange County continue to set the bar lower! I mean, it’s not enough that we have to deal with all those presently there that care nothing about the people they represent. This appointment bring even more lack of confidence to an already poor appearance in Orange County. Not even addressing whether all this “dust” is true or not, the simple APPEARANCE (and I must say iot is a rather strong appearance at that!) of wrong doing is enough to sour everything about this “appointment”.
Moolach continues to prove how unreliable and total inept he really is, as well as lacking in intesgrity and pride in being a public servant! He is a sham and I am DISGUSTED!
October 7th, 2008 at 12:08 am
Only a moron would appoint a fired OCERS investment Manager to the OCERS Board. Or is that only a Moorlach?
October 7th, 2008 at 6:33 am
So last week Mr. Moorlach blocked Supervisor Norby’s attempt to rescue a battered women’s shelter from closing, thereby placing abused women and their children on the street. And now this week he tries to stick an old crony on the OCERS board who may be trying to steer OCERS investments to his current but apparently hidden employer. It makes you wonder whose side Mr. Moorlach is on. Certainly not the little guy.
October 7th, 2008 at 7:04 am
Well this is just typical of why things are such a mess in the financial world today. Instead of picking someone qualified, Moorlach is simply trying to appoint as many of his friends as he can. To fire someone from the board without cause and to replace him with a controversial figure that is cut from the same mold seems to be Moorlachs M.O. Absolute power corrupts absolutely and we have seen that with such an arrogant meglomaniac as Moorlach. Even Chris Norby can’t stand the guy anymore.
October 7th, 2008 at 8:24 am
“Moorlach said he regarded Flanigan’s resignations as a badge of courage for swimming against the investment current with his conservative strategies”
Yea, Moorlach would say that wouldn’t he…nice spin!!! NOT.
The guy’s resume is pitiful and his business dealings tainted already. I hope he is stopped once and for all.
October 7th, 2008 at 9:53 am
Keep it up Johnny, you will blow your chance at dog catcher in the next election. People are catching on to you.
October 7th, 2008 at 6:06 pm
Leave it to Moorlach not to vet a proposed appointee to an important position…Does Chriss Street ring a bell?