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The Bad News For The KRS Will Never End

July 1st, 2013 · No Comments

Of course Kentucky’s flustercuck of a pension system gets mentioned on CNBC.

And the Independent Counsel representing the whistleblower from Kentucky Retirement Systems was profiled in the Providence Journal:

Chris Tobe, a Kentucky pension consultant, says he met Siedle in the late 1990s, when he tracked the state pension fund for the Kentucky state auditor. In 2010, when Tobe served on the board of the $14-billion Kentucky Retirement System, he hired Siedle to represent him after filing an SEC whistleblower complaint involving millions of dollars in placement agent fees.

Siedle produced a report to the SEC in 2012 in which he called the state’s conclusions that there was no evidence of impropriety unfathomable.

“I have investigated dozens of pay-to-play schemes … from Guam to Florida,” he wrote, alluding to the practice of money managers making campaign contributions to get business.

Siedle went on to question inflated and undisclosed fees that could be costing the state millions.

The SEC is investigating Kentucky. Tobe says the retirement system has balked at paying Siedle’s legal fees, because a majority of the board didn’t consider the money-management fees a problem.

“They don’t want to pay people to uncover corruption — they want to pay them to cover it up,” says Tobe.

Says Siedle: “Nobody ever says, ‘I have a bad reputation. I take kickbacks. I have a poor track record.’ You have to peel back the onion, ask the questions three and four times.”

While the two largest newspapers in Kentucky have loosely covered the corrupt pension system (the Courier-Journal/A Kentucky Newspaper scratching the surface and the Herald-Leader picking at the scab), neither paper has really dug into the mess. Sure, everyone knows the KRS is corrupt and wasteful but there is no pension watchdog because no one is interested or can afford to really dig in.

Neither paper has focused much on Siedle’s report to the Securities and Exchange Commission. It’s barely been mentioned.

Adam Edelen’s KRS audit will also just sort of pick at the scab and lightly caress the surface of that puss-filled entity. He wants to run for governor but doesn’t want to take real responsibility for cleaning up corruption because he doesn’t want to lose his financial edge. Otherwise, he wouldn’t maintain super-tight ties to placement agents/lobbyists like Mark Riddle and his spokesperson wouldn’t be furthering those ties:






If Edelen gave a flip, he wouldn’t lie about his ties and most certainly wouldn’t continue something that furthers the appearance of impropriety. Like Edelen’s audit, we’re just scratching the surface here.

How dare us criticize and question a Democrat. How dare us, we know.

All of this? It’s why Kentucky can’t have nice things. It’s why nothing will change in Frankfort any time soon.

Tags: Adam Edelen · Corruption · Mainstream Mistake