KRS en Beshear Pleased With Appeal in Seven Counties Case <p>Governor Steve Beshear says he is pleased with a decision by the Kentucky Retirement Systems to appeal a recent ruling that would allow quasi-governmental agencies to withdraw from the beleaguered public pension system.</p><p>Earlier this month a federal judge ruled that groups like the mental health nonprofit Seven Counties Services, which is currently filing for bankruptcy as a result of its pension debt, could exit KRS because they aren’t government agencies.</p><p>Beshear says that if the decision is upheld, it would create millions of dollars in new unfunded pension liabilities.</p><p>“It is a very dangerous ruling, in terms of the financial stability of our pension system. And so I want to make sure that that gets a full hearing and hopefully will get overturned on appeal,” said Beshear</p><p>The Kentucky Employee Retirement System’s total unfunded liability is about $17 billion.<br /> Wed, 11 Jun 2014 23:21:00 +0000 Jonathan Meador 49425 at Beshear Pleased With Appeal in Seven Counties Case Kentucky City Sues State Pension System Over Risky Investments <p>A Kentucky city is suing the state's public pension system over its investment of county employees' retirement money into "risky" hedge funds.</p><p>An attorney for Ft. Wright, a northern Kentucky city of 5,700, filed a class-action lawsuit Monday alleging that Kentucky Retirement Systems improperly used money from one of its subsidiary funds to make investments that were illegal under state law.<br /><br />The civil suit, filed in Kenton Circuit Court, alleges that KRS put an "unreasonably large percentage" of money from a subsidiary fund -- County Employment Retirement System (CERS) --&nbsp; in "high risk investments which are not appropriate investments for fiduciaries under the common law of Kentucky."</p><p>KRS has come under increasing scrutiny over the last couple of years due to poor performance, investments in risky hedge funds and, more recently, the handsome fees those hedge funds reaped from its contracts with the state's beleaguered $15 billion pension system. KRS was recently named among the worst-funded pension system in the nation, at under 24 percent funding.<br /><br />The lawsuit seeks a court order of damages in total of at least $50 million, which Ft. Wright argues was spent on "management fees" charged by hedge funds and private equity groups per KRS' investment strategy. The lawsuit also seeks to establish a separate investment portfolio for the subsidiary fund, CERS. This would effectively divorce it from the current system whereby CERS' assets are "co-mingled" with KRS.<br /> Wed, 04 Jun 2014 00:07:00 +0000 Jonathan Meador 49025 at Kentucky City Sues State Pension System Over Risky Investments Fitch Names KRS Pension Worst-Funded in Nation <p>Global credit agency Fitch Ratings has named one of Kentucky’s pensions as the worst in the nation. The non-hazardous pension under the Kentucky Employee Retirement System has about a quarter of the money it would need to pay out what will be owed to pensioners.&nbsp;<br /><br />Todd Green is a senior actuary for Cavanaugh MacDonald, an accounting firm that examined five years’ worth of the state’s pension data. He says the pensions have been neglected and money hasn't been put in them and kept in them.</p><p>“The source of that is the prior underfunding, so it’s not, it’s an accumulation of lots of things that weren’t being done right, ” said Green.</p><p>At a recent meeting of the Kentucky Retirement Systems’ trustees, the body declined to act on recommendations that the pension downgrade its projected investment returns. Bill Thielen is the director of KRS. He says that could result in more money being paid by the legislature toward the fund.<br /> Mon, 19 May 2014 23:18:49 +0000 Jonathan Meador 48289 at Fitch Names KRS Pension Worst-Funded in Nation Whistleblower Disputes Kentucky Retirement Officials on Placement Agent Claim <p>A whistleblower and former member of the Kentucky Retirement System’s board of trustees is disputing claims that the pension plan hasn’t used placement agents recently. Chris Tobe is an investment expert who served on the system’s board for four years. He’s also the main witness in a Securities and Exchange Commissions investigation into KRS and its previous uses of placement agents. Fri, 14 Sep 2012 20:29:54 +0000 19193 at