Brown targets CalPERS officials

May 6, 2010

California Attorney General Jerry Brown filed a lawsuit against two former officials of CalPERS, the nation’s largest public pension fund, for violating security laws. [Reuters]

The complaint, announced Wednesday, focuses on former CalPERS chief executive Federico Buenrostro Jr. and former CalPERS board member Alfred R. Villalobos.

Villalobos earned more than $47 million in fees since leaving CalPERS to work as a middleman for investment firms looking to do business with the agency. The lawsuit says Villalobos courted Buenrostro to influence investment decisions through gifts including luxurious travel, expensive meals and champagne.

The complaint seeks to recover $70 million from Buenrostro, Villalobos and his firm, ARVCO Capital Research for their fraudulent activities.

The lawsuit comes as CalPERS attempts to recoup from epic investment losses and mounting concern about the stability and costs of public pensions in California.