New York City Comptroller William C. Thompson, Jr announced today that the trustees of the Teachers’ Retirement System (TRS) have unanimously resolved to suspend making new commitments with private equity funds which use the services of a placement agent or other compensated intermediary in connection with its investments.

TRS is the fourth of the New York City Pension Funds to heed Thompson’s call that they suspend the use of such agents, firms and middlemen. The New York City Employees’ Retirement System, Fire Department Pension Fund, and Police Pension Fund have previously passed resolutions to suspend the use of placement agents, firms and middlemen in private equity investments.

The five Funds have combined assets of more than $77.1 billion as of March 31. TRS held $26.8 billion in assets as of that date. The remaining fund – the Board of Education Retirement System – is expected to vote on the matter tomorrow.

Thompson has taken the following additional steps to strengthen transparency in the City’s Pension Funds and build on work already accomplished during his tenure:

• He asked the Attorney General to investigate whether the Funds “were intentionally misled or deceived” as to the identities of any placement agents involved in a particular investment.
  
  
• Thompson called on Mary Schapiro, the Chairman of the U.S. Securities and Exchange Commission (SEC), to increase transparency and public confidence in the investment activities of all public pension funds. You can view the Comptroller’s letter at www.comptroller.nyc.gov.
  
  
• He announced this week that he will ask the New York City Pension Funds to adopt the principles in New York State Attorney General Andrew M. Cuomo’s Code of Conduct to further strengthen transparency and eliminate conflicts-of-interest in investments. The Code of Conduct would ban investment firms from hiring, utilizing, or compensating placement agents, lobbyists, or other third-party intermediaries to communicate or interact with public pension funds to obtain investments, and prohibit investment firms (and their principals, agents, employees and family members) from doing business with a public pension fund for two years after the firm makes a campaign contribution to an elected or appointed official who can influence the fund's investment decisions.

The Comptroller serves as a member of the Board of Trustees of four of the five Funds and is investment advisor to, and custodian of, the five. Funds Trustees include Mayor Michael Bloomberg, his commissioners, and representatives and appointees from labor unions. Trustees are as follows:

New York City Employees’ Retirement System: Bud Larson, Mayor’s Representative; New York City Public Advocate Betsy Gotbaum; Borough Presidents Scott Stringer (Manhattan), Helen Marshall (Queens), Marty Markowitz (Brooklyn), James Molinaro (Staten Island), and Ruben Diaz, Jr. (Bronx); Lillian Roberts, Executive Director, District Council 37, AFSCME; Roger Toussaint, President Transport Workers Union Local 100; and, Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

Teachers’ Retirement System: Bud Larson, Mayor’s Representative; Deputy Chancellor Kathleen Grimm, New York City Department of Education; mayoral appointee Tino Hernandez; and, Sandra March, Melvyn Aaronson (Chair) and Mona Romain, all of the United Federation of Teachers.

New York City Police Pension Fund: Mayor Michael Bloomberg; New York City Acting Finance Commissioner Michael Hyman; New York City Police Commissioner Raymond Kelly (Chair); Patrick Lynch, Patrolmen’s Benevolent Association; Michael Palladino, Detectives Endowment Association; Edward D. Mullins, Sergeants Benevolent Association; Thomas Sullivan, Lieutenants Benevolent Association; and, Roy T. Richter, Captains Endowment Association.

New York City Fire Department Pension Fund: Mayor Michael Bloomberg; New York City Fire Commissioner Nicholas Scoppetta (Chair); New York City Acting Finance Commissioner Michael Hyman; Stephen Cassidy, President, James Slevin, Vice President, Robert Straub, Treasurer, and John Kelly, Brooklyn Representative and Chair, Uniformed Firefighters Association of Greater New York; John Dunne, Captains’ Rep.; John J. McDonnell , Chiefs’ Rep., and James J. McGowan, Lieutenants’ Rep., Uniformed Fire Officers Association; and, Joseph Gagliardi, Marine Engineers Association.

Board of Education Retirement System: mayoral appointees Schools Chancellor Joel Klein (Designee, Kathleen Grimm, serves as co-chair), Alan Aviles, Philip Berry, David Chang, Tino Hernandez, Edison O. Jackson, Richard Menschel and Marita Regan; Patrick Sullivan (Manhattan), Wendy Gilgeous (Brooklyn), Joan Correale (Staten Island); and Dmytro Fedkowskyj (Queens); Anna Santos (Bronx);  and employee members Joseph D'Amico of the IUOE Local 891 and Milagros Rodriguez of District Council 37, Local 372 (serves as co-chair).

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