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South Carolina State Treasurer Curtis Loftis, Jr. on efforts to reform the state’s pension system.
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Carolina just one of many states running -- huge deficit with its pension fund -- shortfall of billions of dollars so who is to blame.
My next guest is pointing the finger at pension officials who he says made risky investments with hard earned taxpayer dollars for their own personal benefit.
Beginning.
Here to explain South Carolina State treasurer Curtis locked -- junior Kurtz thanks for coming on tonight.
Tell us what you mean by that I and he dared trying to make money off of -- and taxpayers.
Well no I did say that it was a rather unfortunate headline and then -- line media journal.
That that talked about some of that but it wasn't supported -- -- what is your act is rational and well nor have acquisition of -- I've got his observations and what -- we haven't South Carolina is much what we have all around the country.
They had pension plans that aren't making enough money you know what we've done is we've politicians have to -- got to make 8% rate a half percent in some cases and -- just can't do it.
What we've what we've got that was opaque world where no one can see inside these organizations they have owners confidentiality agreements you know they.
This this world is ruled financial mumbo Jumbo you know doll and her lawyers and understand.
And that's done all purpose so what happens is across the country these places eve -- meaningful oversight they.
They -- meaningful oversight by credentialed people and that's the biggest problem -- Isn't it is what you're talking about no more than -- whining and dining -- local officials so that.
You know Wall Street investment managers can get their money is it more than that.
Well I'm sure I mean there's there's always that part of -- you know we've called public the end we vast for a tighter ethical standards we asked for better.
Disclosure.
And so all that's important but you know what what do these things actually did.
We take the hardworking.
People's money we take that money we take -- new York and we invested.
So we have a great -- we have a high standard because this is the money of working people.
So what does that mean we've got have we've gotta be transparent and we've got to be accountable and these systems across the country.
Aren't that way time it would -- let me just tell you about your -- -- second because.
One of the things that really got our attention about the story is that the former investment chief for South Carolina public pensions.
Drove around -- state capital of Columbia in a Lamborghini.
He's a civil servant.
That's just not right.
Well I mean you can drop at a record he wants I'm not concerned about that.
But -- -- -- of course it's also the perception.
Of what's going on there yeah and I think a lot of people have been questions about just how close local officials are to some of these money managers and Wall Street.
And also the flip side about how much did you know about how this money was really being invested.
-- a recurrence or not that's BP.
Yeah and that's the key in -- in -- and let me say you know isn't that agrees I can't it's not just South Carolina this is across -- These groups say that they're transparent but they're not when you if it's like the -- -- you -- the curtain back on every single one of these commissions and you find that they don't have the infrastructure.
To manage your debt they they don't have their investments they don't have the infrastructure to know.
How much they're paying fees is common practice for especially in the alternatives farthest distance for them to net fees what that means is when they -- are art.
Check today in the quarter ended the year they just net -- -- out of there.
So right in to get these.
-- -- -- -- -- -- -- -- -- all their money -- let me interrupt you for a second here you get a fourteen point four billion shortfall in pension funds and South Carolina public pension funds tell me.
How -- you get that fixed.
Well that get up -- that one last thing.
The -- a piece is important because we don't get information on the fees we can pay fifty million dollars in one year to one company and never get a written explanation -- face so you don't know it would -- Before five different they -- that investment our -- It and so we've got to know -- and that's that's the biggest problem.
He stayed out there it has -- everything should be demanding that.
It -- in the remaining yeah but.
The -- here's what happens.
New York and the cockpits of planes together have these -- confidentiality agreements like I can read the contracts but my lawyers -- the governor -- can't read contracts.
Until -- have the attorney general this -- the chief legal officer he can't read a contract so.
This is a process and what we've got is it's -- our individual lashing it's across the country there's no meaningful oversight and we got to have -- -- well I am and I can't agree with you Maureen makes several good points here thanks for coming on the show tonight I really appreciate you spent much of Citi.
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