In the wake of a scandal involving the previous state comptroller, Alan Hevesi, and the New York retirement fund he oversaw, an outside firm has declared current Comptroller Thomas DiNapoli to be running the fund in an honest and efficient manner.
Hevesi served as comptroller from Jan. 1, 2003, to Dec. 22, 2006. Initially he was pushed from office by revelations about his employment of four state employees to serve his wife.
However, in 2010 Hevesi pled guilty to investing $250 million from the retirement fund into an investment firm in exchange for $1 million in benefits from the firm's owner. Among other things, the $1 million went to cover hotel and travel costs for family trips to Italy and Israel and for $500,000 in campaign contributions.
Hevesi served one and a half years in prison and was released in November.
DiNapoli became the comptroller in Feb. 7, 2007. In the wake of the Hevesi scandal a special pension task force in 2007 developed recommendations to reform the pension fund. One of the task force's recommendations was to conduct "fiduciary and conflict of interest reviews of the fund every three years by a qualified person."
On Tuesday, Funston Advisory Services LLC gave the fund and DiNapoli's handling of it a clean bill of health.
"Following an extensive review process, we found the comptroller is fulfilling his fiduciary responsibility, and investment operations are well-run," Funston managing partner Rick Funston wrote. "The fund has a strong and effective framework for operations and decision-making processes, and investment policies and practices are robust. The fund also operates with a high level of transparency."
The fund serves as the pension fund not only for state employees but also for local government employees except teachers and New York City government employees.
As of Dec. 31, 2012, the fund had $153 billion and was funded at 87%, one of the highest funded ratios of the county's public pension plans.
"Since becoming comptroller, I have improved policies and procedures, strengthened internal controls and standards, and increased public disclosure," DiNapoli said.
