Corrupt ex-CalPERS official commits suicide

February 2, 2015

calPERSA former CalPERS board member facing a corruption trial in federal court committed suicide in January. [LA Times]

Alfred Villalobos, 71, killed himself in Reno, his town of residence, city police confirmed. Villalobos was just weeks away from standing trial for bribery and fraud in connection with efforts he made to influence the investment decisions of CalPERS, which is the California retirement system and the largest public pension fund in the nation.

After serving as a CalPERS board member from 1993 to 1995, Villalobos became a placement agent who helped hedge funds and other investment groups wins CalPERS business. He earned about $50 million between 2005 and 2009 as a middleman between CalPERS and private equity clients.

A former CalPERS chief executive and co-defendant in the case cooperated with prosecutors and said that he accepted more than $250,000 in bribes and gifts from Villalobos. Federic Buenrostro Jr., who still faces sentencing in the case, said Villalobos would deliver much of the money in paper bags and shoe boxes at the Hyatt Hotel across from the Capitol in Sacramento.

Prosecutors charged Villalobos and Buenrostro with conspiring to create phony documents that helped Wall Street equity firm Apollo Management land a $3 billion CalPERS investment deal. Apollo is not accused of wrongdoing, but the firm paid Villalobos $14 million in fees.

In 1993, Villalobos briefly served as Los Angeles deputy mayor for economic developments. He resigned after revelations about his finances.

Then-mayor Richard Riordan said he fired Villalobos after five months on the job.

“He was more than ethically challenged,” Riordan said. “He was so bad that I went out of my way to recommend that they not put him on the CalPERS board.”

An attorney who represented Villalobos said the former CalPERS board member was in and out of the hospital prior to his death. Villalobos had constant pain from a neurological disorder, his attorney said.


One thieving, dishonest, bought-off and corrupt California administrative/political operative DOWN, approximately 259,651 LEFT to go.


Money delivered in paper bags and shoe boxes across from the Capital – sounds like a Soprano’s plotline.

Wonder if any other CalPERs execs were on the take in addition to Federic Buenrostro Jr.


Calpers wasn’t satisfied with rates are that guys like me have to settle for. CDs and conservative funds weren’t good enough and their greed got them in trouble.


They cannot invest conservatively because their pension is underfunded by 30% or so – which means that they can’t meet their future pension obligations at their actuarial return projections.

See their stats from their website (funding status page 3).

Guess who picks up the tab when their scheme eventually defaults?


“He was more than ethically challenged,” Riordan said. “He was so bad that I went out of my way to recommend that they not put him on the CalPERS board.”

But they did it anyway…

It’s not what you know, it’s who you know- – –

apparently NO matter how much of a crook you are.

Jorge Estrada

If I read this correctly, a middle man earned $50 million dollars in five years by managing investment exposure for the CalPers pyramid scam. Reads like reality is around the corner for all existing as well as new benefits for this plan.


The problem is that the California taxpayer is legally on the hook for a lot of that. If CALPERS doesn’t come through with enough to fund the public employee pensions guaranteed, a court could order the state to pay for it even if it meant cutting other things like education, road repairs, and so forth or raising taxes.

I don’t have a problem with the concept of a public employee pension plan but I do have a problem with a taxpayer-guaranteed return on it. The plan should be monitored by those who contribute to it and if the plan has problems they should suffer the consequences themselves.


““He was more than ethically challenged,” Riordan said. “He was so bad that I went out of my way to recommend that they not put him on the CalPERS board.”

and 50 mil? there was a wink and a nod all around.

the least checked out book in the library is Ethics.


SLO could use a mayor like Richard Riordan. He had the guts to fire this guy. Meanwhile we have SO MANY incompetent leftovers from Malibu, Santa Barbara County and elsewhere making six figures and doing NOTHING to dig our city out of the hole and our Mayor claims she knows nothing about the people Katie Lichtig has hired who also seem to be “ethically challenged.”

Changes CAN be made but they require backbone. All we have is open space.


Would be interesting to know who appointed this turkey to the board, after Riordan had his say against the appointment. If it was a gubernatorial appointment, sounds like that would have been the Gubernator, though it could also have been a legislative appointment.


I hope they can find the ill-gotten gains and do something just with them. I hope they will take a close look at the finances of his family, friends and business associates. That is prolly where all that money is.

And lastly, how is it that Apollo Management is clean in this? If they are, then that points is a much larger endemic problem!


Of course there’s a much larger endemic problem. The problem is public employee unions. What was the first big “legal” business the Mafia engaged in, that’s right, unions. You “public servants” who actually believe this Ponzi slush fund will endure, boy do I have a bridge to sell you. I suggest you google David Hannum for further enlightenment.


I don’t know if Apollo Management was clean or not but big Wall Street Investment firms have a very good track record of escaping legal responsibility for actions that are or should be illegal. Jefferson County Alabama (Birmingham) is dead broke and will stay that way for many years because JPMorgan officials bribed and conned some crooked county officials into using some unsafe investment techniques to fund a major sewage treatment plant replacement.

The county officials made it worse by some other sleazy actions that ran the cost from $250 million to $3 billion but they ended up owing JPMorgan $1.28 billion in fees and interest alone shortly after the deal. The SEC finally forced JPMorgan to refund half of that due to fraud and pay another $75 million in penalties but they still made off with about $500 million and not one of them spent any time in jail or paid any individual penalties. The crooked county officials were not so lucky but they didn’t have the best lawyers and politicians in the country looking after their interests.

If anyone is watching over any public organization dealing with Wall Street investment firms, watch very closely and check both the integrity of those negotiating the money and the fine print on any agreements. There may not be many good options on where to get the money, but buyer beware on the specific way to do them. The Dodd-Frank Reform Act that was supposed to correct the abuses by Wall Street has some major loopholes and there are currently efforts in congress to add more.


Greed is not always good.