Sunday, February 1, 2015
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

Ex-chief of huge pension fund guilty of bribery

By
From page A1 | July 12, 2014 |

SAN FRANCISCO — The former head of the nation’s largest pension fund admitted Friday that he took bribes, including hundreds of thousands of dollars stuffed in paper bags and a shoe box, and helped an associate collect millions in a fraudulent investment scheme.

Fred Buenrostro Jr. pleaded guilty in San Francisco federal court to fraud and bribery charges stemming from his time as chief executive of the California Public Employees’ Retirement System from 2002 to 2008.

In his plea agreement, Buenrostro said that in exchange for his help Alfred Villalobos, a former CalPERS board member, took him on a trip around the world, gave him casino chips and paid for his wedding in Lake Tahoe, California.

Villalobos denied the allegations through his attorney Friday.

Buenrostro’s guilty plea arises from a yearslong investigation into the role of money-management firm middlemen, called placement agents, in helping clients win investment business from a California pension system that controls $300 billion.

CalPERS said the investigation has prompted it to take “aggressive steps to implement policies and reforms that strengthen accountability and ensure full transparency.”

Buenrostro said in his plea that he started taking bribes in 2005 to use his influence with CalPERS to make investment decisions to help Villalobos’ clients. He also said he gave Villalobos, a CalPERS board member in the mid-90s, access to confidential investment information.

The 64-year-old former executive said he forged letters allowing firms connected with Villalobos to collect a $14 million commissions on $3 billion pension fund investments. He said he started writing bogus investor disclosure letters after CalPERS legal and investment officials declined to authorize them.

Further, Buenrostro said after he left CalPERS and went to work for Villalobos that he accepted $50,000 to lie to federal investigators in 2010 about their relationship.

Buenrostro faces five years in prison and a $250,000 fine when he is sentenced in January. In exchange for a lesser sentence, Buenrostro has agreed to cooperate with the continuing investigation of Villalobos, said Buenrostro lawyer William Portonova. “He got tired of lying,” Portonova said. “He’s ready to tell the truth.”

Villalobos has pleaded not guilty to fraud charges and other related counts. His attorney, Bruce Funk, said his client denies the claims contained in Buenrostro’s plea agreement. “If he’s truthful, there is nothing he can say that will hurt Mr. Villalobos,” Funk said.

Buenrostro and Villalobos, 70, also face two government lawsuits.

The state attorney general sued in 2010, saying Buenrostro and Villalobos, along with other former pension board and staff members, participated in kickback scheme.

At that time, the attorney general obtained a court order freezing assets of Villalobos and his company in an attempt to recover more than $40 million in commissions. Villalobos filed for bankruptcy later in 2010. His assets included 20 bank accounts, two Bentleys, two BMWs, a Hummer, art worth more than $2.7 million and 14 properties in California, Nevada and Hawaii. None of Buenrostro’s assets were seized.

State attorney general spokesman Nick Pacilio said a trial is scheduled for Sept. 8 in San Francisco Superior Court.

The Securities and Exchange Commission has also filed a lawsuit in 2012, which is still pending.

In a related sanction, the state’s campaign watchdog, the Fair Political Practices Commission, fined other executives and investment managers in 2011 for failing to report gifts that included food, wine and baseball and Rose Bowl tickets.

 

The Associated Press

The Associated Press

LEAVE A COMMENT

Discussion | 2 comments

The Daily Republic does not necessarily condone the comments here, nor does it review every post. Read our full policy

  • rlw895July 12, 2014 - 10:19 am

    CalPERS better get it's house in order. It's an amazing story of corruption.

    Reply | Report abusive comment
  • Mr. Green ValleyJuly 12, 2014 - 11:37 am

    CalPERS members better hope CalPERS gets their act together. Especially if they are counting in the pensions for their retirement. Look at what's going on with the city of Stockton, Detroit and social security. The government corruption will screw all the hard working members while continuing to lie for their votes. Sounds a lot like Washington doesn't it?

    Reply | Report abusive comment
.

Solano News

 
Police make 2nd arrest in deadly Thanksgiving Day shooting

By Glen Faison | From Page: A1 | Gallery

Fire Department honors top firefighters

By Bill Hicks | From Page: A1 | Gallery

 
Everything you need to know about Super Bowl

By Brad Stanhope | From Page: A2

 
 
$340,688 brick replacement for Texas Street complete

By Ryan McCarthy | From Page: A3

 
4th annual Health and Wellness Fair a big success

By Susan Hiland | From Page: A3 | Gallery

 
Banish dry skin this winter

By Sarah Porkka | From Page: C4

Chocolate: A long journey to deliciousness

By Karen Metz | From Page: C4

 
County board to consider DA reorganization plan

By Kevin W. Green | From Page: A5

Eurozone offers lesson in debt

By Mark Sievers | From Page: B7

 
Rodriguez graduate completes basic training

By Nick DeCicco | From Page: B10

 
Fairfield police log: Jan. 30, 2015

By Susan Hiland | From Page: A12

Suisun City police log: Jan. 30, 2015

By Susan Hiland | From Page: A12

 
.

US / World

From ocean to ocean, through the Panama Canal

By The Associated Press | From Page: C1

 
Video: Islamic State group beheads Japanese journalist

By The Associated Press | From Page: A1

NASA launches Earth-observing satellite

By The Associated Press | From Page: A1

 
Man arrested after body parts found in suitcase

By The Associated Press | From Page: A5

Scientist considered father of birth control pill dies

By The Associated Press | From Page: A5

 
‘Rolled Sleeves Bandit’ tied to 7 bank robberies in custody

By The Associated Press | From Page: A5

Bay Area agency accuses former official of embezzling $1.3M

By The Associated Press | From Page: A5

 
Los Angeles female-only mosque may be first in US

By The Associated Press | From Page: A5

California health care contract fight resolved

By The Associated Press | From Page: A5

 
Snails slither into spa scene in Thailand and around world

By The Associated Press | From Page: C6

Not so ‘Good to Go’ when man gets $18,000 toll bridge bill

By The Associated Press | From Page: A6

 
Balloon pilots make history with trans-Pacific flight

By The Associated Press | From Page: A6

Whitney Houston’s daughter found unresponsive in tub

By The Associated Press | From Page: A6

 
Letter with suspicious powder received at Samaritan’s Purse

By The Associated Press | From Page: A6

Drivers: Return to your dealers for a 2nd air bag recall fix

By The Associated Press | From Page: A7

 
Hatfields, McCoys make moonshine legally in southern W.Va.

By The Associated Press | From Page: A7

Airport authorities: Traveler beats homeless man with chair

By The Associated Press | From Page: A7

 
Kerry: ‘Enormous interest in new relationship with Cuba

By The Associated Press | From Page: A7

 
5 given preliminary charges over jihadi network in France

By The Associated Press | From Page: A9

Fire devastates major Russian library, threatens rare texts

By The Associated Press | From Page: A9

 
Swiss police: 4 dead after avalanche hits group of skiers

By The Associated Press | From Page: A9

Fire at Bangladesh plastics factory kills at least 13

By The Associated Press | From Page: A9

 
Vatican investigates 2 cases of child porn possession

By The Associated Press | From Page: A9

Islamic State fighters admit defeat in Syrian town of Kobani

By The Associated Press | From Page: A9

 
From car lots to city budgets, cheap oil means change

By The Associated Press | From Page: B9

Africa agrees to send 7,500 troops to fight Boko Haram

By The Associated Press | From Page: A9

 
British actress Geraldine McEwan dies at age 82

By The Associated Press | From Page: A10

Greek leader tamps down rhetoric, vows to pay off debts

By The Associated Press | From Page: A10

 
Civilians flee east Ukraine town as fighting intensifies

By The Associated Press | From Page: A10

Iraqi libraries ransacked by Islamic State group in Mosul

By The Associated Press | From Page: A11

 
.

Opinion

Good old days weren’t as good as we remember

By Megan Mcardle | From Page: A8

 
Editorial Cartoon: Feb. 1, 2015

By Daily Republic Syndicated Content | From Page: A8

 
Sound off for Feb. 1, 2015

By Daily Republic | From Page: A8

 
.

Living

Community Calendar: Feb. 1, 2015

By Susan Hiland | From Page: A2

 
Today in History: Feb. 1, 2015

By The Associated Press | From Page: A2

Prayer, commonly misunderstood

By The Rev. Rick L. Stonestreet | From Page: C3

 
Mormon leaders call for measures protecting gay rights

By The Associated Press | From Page: C3

Sundance doc pulls back curtain on Scientology

By The Associated Press | From Page: C3

 
Horoscopes: Feb. 1, 2015

By Holiday Mathis | From Page: C4

Volunteer or visit because February is National Salute to Veteran Patients

By Kathy Mitchell and Marcy Sugar | From Page: C4

 
.

Entertainment

PUBLISHERS WEEKLY BEST-SELLERS

By The Associated Press | From Page: C2

 
Review: ‘First Bad Man’ is Miranda July’s debut novel

By The Associated Press | From Page: C2

 
Lorrie Moore nominated for short story prize

By The Associated Press | From Page: C2

New book to feature unpublished Hemingway conversations

By The Associated Press | From Page: C2

 
TVGrid

By Daily Republic Syndicated Content | From Page: B11

.

Sports

Mustangs win the whole Encalada

By Marcus Lomtong | From Page: B1 | Gallery

 
Super Bowl the final act of the NFL’s worst season

By The Associated Press | From Page: B2

Lowest prices on last-minute Super Bowl tickets near $9,000

By The Associated Press | From Page: B2

 
Seau, Bettis, Brown, Haley, Shields voted into Hall of Fame

By The Associated Press | From Page: B3

 
Rodgers wins MVP, Watt unanimous top AP defensive player

By The Associated Press | From Page: B3

Lydia Ko takes No. 1 spot at 17, Na Yeon Choi wins opener

By The Associated Press | From Page: B3

 
Laird takes a 3-shot lead in Phoenix Open

By The Associated Press | From Page: B3

.

Business

Small talk: NFL players find second careers as entrepreneurs

By The Associated Press | From Page: B7 | Gallery

 
On the money: Low gas prices, incentives change math for electric cars

By The Associated Press | From Page: B7 | Gallery

Recalls this week: space heaters, orbital sanders

By The Associated Press | From Page: B8

 
Sumptuous seaside hotel sells for record-shattering $360M

By The Associated Press | From Page: B8

Review: Open e-book format comes with headaches

By The Associated Press | From Page: B9

 
.

Obituaries

Joe Lambert Robinson

By Nancy Green | From Page: A4, 1 Comment

 
Flora Mae Brooks

By Susan Hiland | From Page: A4

Otilia (Tela) Quinn

By Nancy Green | From Page: A4, 1 Comment

 
Lester Singer

By Nancy Green | From Page: A4

WillIiam “Bill” Hunter

By Nancy Green | From Page: A4

 
Garry A. Britton

By Nancy Green | From Page: A4

Anthony Neal Hunley

By Nancy Green | From Page: A4

 
Frank Z. Perez

By Nancy Green | From Page: A4

.

Comics