Saturday, May 27, 2006

Shirlee Zerkel: Be Watchful of Home Equity Loans!

May 27, 2006
While this is not STRS-related, there's some very valuable information and words of warning here for anyone thinking of getting (or already has) a home equity loan -- from someone who knows! Thanks to Shirlee Zerkel for sharing this with us. KBB
This is a word of advice for those who have home equity loans or are thinking of taking one out.
Basically they are good, but some banks do not provide the security that the borrower needs. If you have taken a home equity loan out and used only part of the money, the rest sits there waiting for you to use it -- or for someone else to steal it.
Did you know that if someone breaks in and steals your banking information or intercepts your mail that may have the account numbers on it, they can walk into some banks in the grand state of Ohio or in a neighboring state where a bank branch may be and take out all of your accounts and also the remaining loan money in your equity account?
The bank would do nothing to help you if the loan money was taken, for they know that they are going to charge the whole loan against you because you are already making payments on the money you have accessed from the loan account, and if you don't pay, your credit will be ruined.
If you suspect someone stole your records, you can close most accounts and then open a new account with a new number in such areas as checking, and savings. But you can't close out and reopen an equity loan. You would have to refinance that loan, but banks don't always explain that fact. Please ask about that!
To prevent this horrible thing from happening to you, go to you loan provider and put a block on your equity account. (Even that doesn't always work; tellers aren't always careful.) You could also put restrictions on withdrawals from the loan account.
Since this terrible thing has happened to a member of my family, I am now much more careful. No money can be taken from any of my and my husband's accounts without a picture ID being shown. Please put on the restriction that you and only you can withdraw money from the loan account no matter what type of proof the thief may try to use.
In our family's case the thief used a false POA and the bank allowed the man to take the money even though the bank already had a POA on file for that account. The bank is claiming that they did nothing wrong!
You can't be careful enough with your accounts.
Shirlee Zerkel
Note added 5/29/06: Those loans in which money sits waiting for you to use can also be called flex loans or lines of credit. Different banks refer to them by different names so be careful. SZ

Kudos to STRS and OPERS for having the courage to press this issue - of course their attorneys will also like the $$ they will earn!

"These plaintiffs include two veterans of the shareholder lawsuit scene. The Public Employees' Retirement System of Ohio and the State Teachers' Retirement System of Ohio were lead plaintiffs in the securities fraud case against the telecom firm Global Crossing, where the class-action settlement has reached $345 million and counting."
Posted on Sat, May. 27, 2006

Fund groups are joining lawsuits against UnitedHealth and others in what some call the next big wave of corporate scandal.

Pioneer Press

Whenever the St. Paul Teachers' Retirement Fund Association had a chance to join a shareholder lawsuit against the wayward company of the moment, directors consistently said no.

Charged with overseeing $1 billion in investments for some 10,000 current and retired teachers, the fund's directors decided they didn't have the time or wherewithal to get involved.

But the stock-options scandal at UnitedHealth Group is a different story. They decided that the possible backdating of executive options and the billions of dollars in compensation in question finally met their threshold.

"This is one that is happening in our own back yard," said Phil Kapler, the fund's executive director. "It is one we think stands out as a particularly egregious misuse of control."

The St. Paul teachers fund has joined a pack of plaintiffs and law firms going after the Minnetonka health insurer, one of several companies under scrutiny for the way it handled stock options in the past. A dozen lawsuits have been filed against the company. Some seek the return of money to the company; others seek damages for shareholders.

UnitedHealth, a consistent winner for investors for years, now finds itself an inviting litigation target. No wrongdoing has been confirmed, but investors have lost more than $18 billion as the insurer's stock has tumbled in the wake of allegations. The company has indicated it may have to erase as much as $286 million in past earnings.

The St. Paul teachers retirement fund may be new to the litigation game, but it's linked up with a big league player: Bernstein Litowitz Berger & Grossmann, the New York law firm whose top partners Business Week once dubbed "the Kings of Class Actions."

Among the firm's conquests: prying more than $6 billion out of WorldCom, the telecommunications company that collapsed in the wake of a massive accounting fraud. Bernard Ebbers, former WorldCom chief executive, has been sentenced to 25 years in prison.

Now lawyers are maneuvering to ride what some say is the next big wave of corporate scandals. The probe into possible backdating of option grants goes well beyond UnitedHealth. The Justice Department, the Securities and Exchange Commission and the Internal Revenue Service are investigating at least 22 companies for the practice.

"The backdating of option grants generally, and the magnitude of the backdated options alleged to have occurred at UnitedHealth represents one of the more egregious corporate scandals in recent times and can only be described as greed, pure and simple," argues Gerald Silk, an attorney with Bernstein Litowitz Berger & Grossmann.

In a statement this week, UnitedHealth said, "We intend to vigorously defend the interest of the company and its shareholders." The company has made a number of changes in its compensation program, and an extensive internal review is continuing. Earlier this month, it disclosed that it had identified "a significant deficiency" in the administration and accounting of its option plans.

The St. Paul teachers' fund is listed — in one of a dozen lawsuits filed in federal and state courts — as one of six public pension funds suing to recover money for the company from executives and directors.

The lawsuit alleges that William McGuire, the company's chief executive; Stephen Hemsley, its chief operating officer; and several other UnitedHealth executives received several billions of dollars worth of stock-option grants that were backdated to coincide with dates on which the stock prices were particularly low. That meant bigger profits for the executives when they exercised the options. The backdating makes the options illegal, the lawsuit argues.

The pension funds are asking the court to freeze all unexercised options made to McGuire and Hemsley until the case is resolved, and to force executives to return to the company the money reaped from the sale of the options.

Other actions are aiming to recover money for shareholders, who've watched their stakes in the company shrivel as UnitedHealth's stock has dropped since mid-March, when the Wall Street Journal first reported the questionable options activity.

These plaintiffs include two veterans of the shareholder lawsuit scene. The Public Employees' Retirement System of Ohio and the State Teachers' Retirement System of Ohio were lead plaintiffs in the securities fraud case against the telecom firm Global Crossing, where the class-action settlement has reached $345 million and counting.

The lead counsel in that case — Grant & Eisenhofer, based in Wilmington, Del. — also represents the Ohio funds in the UnitedHealth.

Of all the companies under scrutiny, UnitedHealth "seems to be the biggest and worst offender," said Jay Eisenhofer, the attorney for the Ohio pension funds. The Ohio funds own a combined 5.6 million shares of UnitedHealth stock and manage a total of $130 billion in assets.

In addition to seeking money for shareholders, the Ohio funds are also looking to recover money they think is due the company. It's possible, as cases are consolidated in a legal shuffling, that the two efforts will converge.

Beyond getting their own money back, pension funds tend to join shareholder lawsuits because they see it as a way to keep management accountable, said Professor Niels Schaumann, who teaches corporate and securities law at William Mitchell College of Law.

"The fact of the matter is, if not for these lawsuits," he said, "there would be, oftentimes, no possibility of disciplining management."

Julie Forster can be reached at or 651-228-5189.

Did you or do you take any of these Rx's? You may still be eligible for some $$

This is still in litigation as I send this email -- John (May 26, 2006)
Press Release: Average Wholesale Price (AWP) Drug Litigation
Case Charging Nation’s Largest Drug Companies of Defrauding Consumers Moves Closer to Trial; Patients receiving physician-administered drugs urged to join suit
August 18, 2005

BOSTON - In a case charging the nation's leading drug companies with defrauding consumers and inflating the cost of prescriptions, U.S. District Court Judge Patti B. Saris has ruled she will grant the case national class-action status once attorneys for the plaintiffs make technical changes to the complaint.
The complaint was originally filed in 2002 by Seattle attorney Steve W. Berman, managing partner of Hagens Berman Sobol Shapiro, and alleges that drug manufacturers including AstraZeneca (NYSE:AZN), Bristol-Myers Squibb (NYSE:BMY) and GlaxoSmithKline (NYSE:GSK), routinely inflate the Average Wholesale Price (AWP) they report to trade publications as part of a scheme to defraud consumers. The Average Wholesale Price is the average cost of a drug on the wholesale market.
According to Judge Saris' class certification order, issued on August 16, 2005, the redefined class will include all persons who received physician-administered drugs manufactured by the drug companies in question.
Steve Berman said that the judge's order was made with the expectation that the suit against the defendants will move to trial. "Once technical changes are made to the complaint, Judge Saris ruled she will certify the class and that charges against the defendants will move forward."
The complaint focuses on a range of often-expensive drugs administered in a clinical setting. These medications are used in the treatment of many types of cancer and other serious illnesses. The new proposed class will include thousands of patients who received such treatments.
Attorneys said that it will be important to demonstrate the large number of individuals included in the class. As the case moves forward, attorneys are urging all people who received certain physician-administered drugs to add their name to a growing list of potential plaintiffs.
"Once we prove that thousands, even millions of innocent people have been defrauded and forced to pay inflated prices for their medications, the drug companies will be forced to give an account," Berman said. "That's why it is essential that individuals who have received these drugs stand up and be counted."
The prescription drugs mentioned in the complaint include:
  • Albuterol
  • Alkeran
  • Amikin
  • Amphotericin B
  • Blenoxane
  • Coumadin
  • Cytoxan
  • Diprivan
  • Etopophos
  • Floxin
  • Fungizone
  • Haldol
  • Imitrex
  • Integrilin
  • Intron-A
  • Kytril
  • Lanoxin
  • Levaquin
  • Myleran
  • Navelbine
  • Paraplatin
  • Procrit
  • Proventil
  • Pulmicort
  • Remicade
  • Retrovir
  • Risperdal
  • Rubex
  • Taxol
  • Temodar
  • Tequin IV
  • Ventolin
  • Vepesid
  • Zantac
  • Zofran
  • Zoladex
  • Zovirax
  • All persons who have received treatment with any of the above drugs will be considered a part of the class and may be eligible for monetary restitution.
    Potential class members can join the suit by visiting or by contacting Hagens Berman Sobol Shapiro at or (206) 443-9357.

    206-623-7292 Media Contact: Mark Firmani 206-443-9357

    Friday, May 26, 2006

    Bev Rice: More kudos to Nancy Boomhower on her childcare speech to the Board

    Note: Nancy's speech appears with the May 18 postings in this blog. KBB

    Tom Curtis to Nancy Boomhower, May 26, 2006

    Hello Nancy,

    I sent your excellent presentation to the STRS board this month to hundreds of people, including the entire legislature. Thank you for doing such a fine job. Below is a response from one of our CORE members in Clark Co.

    Take care,
    Tom Curtis

    May 23, 2006

    Kudos to Nancy Boomhower! Her presentation to the board about the salaries of the childcare center employees was very informative. The research was excellent and a real "eye-opener" for the board and all the educators who read Nancy's report. I can't imagine the board not giving attention to this issue and making necessary changes. Thanks to Nancy for uncovering more waste at STRS.

    Bev Rice
    Clark County

    Thursday, May 25, 2006

    Caremark CEO stock options at $211 million; comments from Sondra Stratton and John Curry

    From Sondra Stratton: It IS really time we do something about this. STRS's employees don't want this as it will be TOO MUCH work for them!!! I doubt that some of the other retirement systems want it as badly as we do. My brother had a light heart attack over the weekend and we went to see about him on Sunday. He showed me his medical booklet. He didn't know about having a mail in prescription company and I was trying to explain it to him. PERS active member's co pay for generic in store is $5 and 90 days mail in was $10 compared to our $20. The highest for any of the drugs was $50. Everything was 1/2 or more of what ours is. Something wrong with this picture and I think it is high time we get Damon and others on the stick about this!!!!!!!!! The longer it goes the more money we lose on this CADILLAC medical plan!
    From John Curry: If the State of Ohio had their own Rx distribution program for government employees/retirees, they wouldn't have to worry about "backdating" $211 million dollars in stock options - would they? Maybe the stakeholders might be able to save a few $$ on Rx since the profit motive would not be a critical factor in "doing business." Think about that the next time you send in a co-pay to Caremark. John
    Caremark CEO stock options at $211M
    The Tennessean, May 21, 2006
    Associated Press
    NASHVILLE, Tenn. - The president and CEO of Caremark Rx Inc., a pharmacy benefits management company that is under federal investigation, has received a total of about $211 million from stock-option sales, according to an analysis by The Tennessean newspaper.
    In two of the seven years that Caremark's board of directors granted stock options to Mac Crawford, they did so the same day that the stock hit a 52-week low for the year, the newspaper reported.
    The Nashville-based company was named last week in a federal investigation into corporate stock option programs.
    Prosecutors appear to be looking into whether companies had backdated stock option grants to their executives to coincide with low stock prices.
    Crawford, the company's chairman, president and chief executive officer, denies having received backdated stock option grants. He told The Tennessean on Saturday that the company plans to cooperate fully and "hopefully get this behind us soon."
    Caremark officials did not return phone messages to their offices Sunday.
    Stock options are rights granted by a company to purchase shares at a certain price, allowing holders to benefit if the stock price rises.
    Backdating involves picking a date in the past when the stock was particularly low, which would allow executives to buy low and sell high.
    During Crawford's eight-year tenure as CEO, Caremark's stock price has increased 280 percent, according to the Tennessean.
    Crawford's $211 million from Caremark stock-option sales were in addition to his annual compensation - including base pay and any bonus - which last year was $4.9 million.
    The newspaper's analysis of the company's proxy statements and other filings show that in one case, Crawford received a block of 3.875 million stock options in lieu of an annual bonus for four years.
    According to Securities and Exchange Commission filings, those options were granted at a price of 15 percent over the closing price for March 8, 2000 - a day that the price tied for the year's low at $3.88 per share.
    In another example from March 1, 2005, Crawford was granted 750,000 options at a price of $37.92, the same day the share price hit its annual low.
    The grant was disclosed to shareholders two days after it was made, in accordance with new SEC guidelines implemented in 2002. Analysts have said that this would make it impossible to backdate the options.
    The company waited longer to disclose the March 8, 2000, grant, which was done April 12. The timing of the disclosure was within SEC regulations at that time, and an analyst has said the monthlong window would not have allowed much time to backdate options.
    When Crawford arrived at Caremark in March 1998, he received a block of 3.25 million stock options priced at $10, which were repriced nearly five months later at $3.25 per share.
    That was in a year that saw the share price swing from a high in January of $21.62 to its historic low of $1.69, almost exactly one month after Crawford's shares were repriced.
    Caremark officials said Thursday that they had received a grand jury subpoena from the U.S. attorney for the Southern District of New York for records about its stock options. The company said it also had received a letter of informal inquiry from the SEC.
    Besides Caremark, the U.S. attorney subpoenaed records from Minnesota-based UnitedHealth Group Inc. and two information technology companies - SafeNet Inc. of Baltimore and Dallas-based Affiliated Computer Services Inc. - on the same subject.
    The SEC's request to Caremark concerned documents about its executive relocation program. The company moved its headquarters from Birmingham to Nashville in 2003.
    A proxy report issued by Caremark last month states that Crawford received an "equity advance" of $2.9 million to cover the sale of his house in Birmingham, which has not yet been sold. He was among several Caremark executives who were offered a relocation package.
    Caremark spokeswoman Joan Gallagher said Crawford has purchased a home in the Nashville area that is being remodeled.
    Caremark provides drug benefit services to more than 2,000 health plan sponsors and their participants throughout the United States.

    Wednesday, May 24, 2006

    OPERS and Ohio STRS sue United Health Group re: manipulation of Stock Options

    Institutional Investors Sue UnitedHealth Group Challenging Options Grants
    Press Release May 23, 2006; Source: Grant & Eisenhofer
    Two Retirement Systems of Ohio claim UHG board allowed CEO McGuire to 'hit the lottery' through decade-long manipulation of stock option plan; suit filed by Grant & Eisenhofer in Minnesota federal court
    MINNEAPOLIS, May 23 /PRNewswire/ -- In the latest shareholder rumble over alleged back-dating of corporate stock option grants, two major state pension funds have brought suit against UnitedHealth Group, Inc., charging that the health care insurer allowed UHG chairman and CEO William McGuire to "dictate his own compensation through the manipulation of the company's stock option plans" for nearly a decade. The suit, brought as both a derivative and class action, was filed by the Public Employees Retirement System of Ohio and the Teachers' Retirement System of Ohio. The two funds hold over five million shares of UHG stock. Their case was filed in U.S. District Court for the District of Minnesota (UHG's headquarters is in Minnetonka, Minnesota).
    The pension funds are represented by noted shareholder and corporate governance law firm Grant & Eisenhofer. In addition to Dr. McGuire, a former pulmonologist who became UHG's chief executive in 1991, defendants include current and former UHG board members, among them former U.S. Vice President Walter Mondale, former New Jersey Governor Thomas Kean, and former U.S. Secretary of Health and Human Services Donna Shalala, as well as current UHG president and chief operating officer Stephen Hemsley.
    Over the last several months, UHG has been under increasing scrutiny for possible violation of securities laws in granting Dr. McGuire propitiously-timed options that have translated into $1.2 billion of compensation. A Wall Street Journal analysis published in March showed that the company's recurring options grants to Dr. McGuire and other executives over the years were so consistently timed on the cusp of sharp run-ups in share value as to defy statistical probability.
    UHG recently announced that it was restating $286 million in net income for the past three years as a result of the "significant deficiency" in its reporting of the options to financial regulators. Both the Justice Department and the Internal Revenue Service are now investigating the company, along with a formal inquiry underway by the Securities and Exchange Commission that followed the Journal's detailed analysis. Since the Journal's initial report of the company's option timing published on March 18, UHG has lost more than $16 billion in market capitalization.
    The funds allege that improper option practices go back at least to 1996, when UHG's board allowed Dr. McGuire to effectively set the strike price for options granted to senior executives. "Dr. McGuire was able to achieve a windfall for himself and his fellow executive(s) ... by retroactively selecting the date on which options were granted," the complaint states. "Dr. McGuire simply picked grant dates on which the share price closed at a relative low point and/or right before a dramatic increase in share price." The company formalized this arrangement in its 1999 employment contract with Dr. McGuire, specifically delegating to its CEO the authority to determine option grant dates for UHG employees.
    The suit charges that in rubberstamping and then concealing Dr. McGuire's control of the option grant dates, UHG's directors "completely abdicated their fiduciary responsibilities" to shareholders, leading the company to vastly overstate its earnings and issue false and misleading financial statements since at least 1997.
    "Because the company failed to disclose this plan to create an artificially low strike price, shareholders were misled every year at proxy time, when they not only were asked to reelect the directors that created and perpetuated the plan, but were asked ... to vote on shareholder proposals relating to stock options that would have substantially eliminated this practice," the complaint charges. The company was also exposed to enormous potential tax liability for misreporting its option practices.
    "Regardless of the success achieved by Dr. McGuire in turning UnitedHealth Group into one of the country's leading health care providers, this case exposes an egregious abuse of executive compensation, in which a single individual was given carte blanche to use stock options as his personal mint," said Jay Eisenhofer, counsel to the pension funds.
    The funds' complaint provides a window into UHG's executive compensation practices, including a 1991 Stock & Incentive Plan mandating that a committee of independent directors -- "none of whom shall be officers or employees of the company" -- determine the purchase price of stock options issued. The 1991 plan also required the committee to set any option exercise price "not less than 100% of the fair market value of the Common Shares at the date of grant of such option," a stipulation that should have prevented backdating of the option grants.
    "As has become obvious in recent weeks, the company's protocols on options as outlined by its 1991 plan were totally subverted by Dr. McGuire in the years to come," Mr. Eisenhofer said. "UHG not only yielded its authority on options issuance to Dr. McGuire counter to its 1991 plan, but it never challenged his manipulation of the grants to continually hit the jackpot time after time by freely dating the options to coincide with dips in the company's stock price for ten straight years. This is as about as extreme a case of unjust enrichment and breach of fiduciary duty as you'll ever see."
    The pension funds assert their claims for each of the options grants issued to Dr. McGuire from 1996-2005, noting that for each period, the CEO selectively chose his own grant dates to match "the best possible dates for him (and) the worst possible dates for the company."
    In relief, the funds are asking that the company disgorge all profits gained by Dr. McGuire and COO Mr. Hemsley, while also canceling or rescinding all outstanding options not yet exercised for which there is proof of back-dating or manipulation of the grant dates. The investors are also seeking compensatory and punitive damages against UHG for the various violations of fiduciary duty.
    Please let us know if you would like a copy of the complaint or would like to speak with attorney Jay Eisenhofer of Grant & Eisenhofer.
    Note: Wilmington, DE and New York-based Grant & Eisenhofer represents institutional investors and shareholders nationally in securities class actions, corporate governance actions and derivative litigation. The firm has recovered more than $2 billion for shareholders in the last five years and was named one of the Top 5 firms for shareholder recovery in 2005 by Institutional Shareholder Services. Currently, Grant & Eisenhofer is lead counsel in shareholder cases against Tyco, Global Crossing, Parmalat, Marsh & McLennan and Refco. In 2005, Grant & Eisenhofer published the Shareholder Activism Handbook, a practical guide for shareholders on corporate governance matters authored by Jay Eisenhofer and Michael Barry. The firm has obtained major corporate governance settlements in shareholder cases against News Corp., Health South and Siebel Systems. For more go to
    Allan Ripp 212-262-7477
    Sara Wolosky 212-262-7470

    From STRS: Report on May 2006 Board Actions and Discussions

    May 24, 2006
    Last week, the State Teachers Retirement Board held several committee meetings, as well as its monthly meeting. Following the regularly scheduled meetings, a report titled "Board News" is posted on the STRS Ohio Web site, as well as mailed to a number of members and education organization representatives who have requested it. As a member of STRS Ohio with an e-mail address on file, you will also receive this report each month. The May report follows.
    One current board member was retained and a new board member will be seated as a result of the recent Retirement Board election. The board's vice chair, Conni K. Ramser, and Mark H. Meuser will fill contributing member seats on the board. Their four-year terms run through Aug. 31,
    At its May meeting, the Retirement Board continued its discussion about potential health care program premiums and plan design changes for calendar year 2007. To begin the discussion, the board received information about benefit recipients and spouses who have disenrolled from the STRS Ohio Health Care Program, and how the disenrollment impacts those who remain in the program.
    As health care premiums have increased during the past few years, fewer new retirees have signed up for the STRS Ohio Health Care Program. This trend, known as adverse selection, has had a compound effect because many previously enrolled members have left the program. STRS Ohio needs to position itself to attract healthy members and replenish the risk pool by maintaining affordable rates.
    The board then reviewed considerations presented by STRS Ohio Member Benefits staff for 2007 health care plan design modifications as well as far-reaching strategies to improve the long-term viability of the health care program. The plan design changes that were discussed are intended to mitigate the effect of adverse selection. The board gave staff direction to further quantify the financial impact of proposed changes and to seek member input on any possible changes before presenting 2007 recommendations at the June board meeting. The board is expected to act on recommendations in June so that 2007 premiums can be presented to the board for approval in August.

    The board voted to adjust several STRS Ohio associate benefits, including sick time payout, health insurance and educational assistance. The net result of these changes is a cost savings of more than $400,000 for the system. Approved benefit changes will go into effect in fiscal year 2007.

    The Retirement Board chose the Russell Investment Group from among three finalists as its general investment consultant. The selection of Russell Investment Group is subject to agreement on a contract, which is expected to run for three years.
    The primary reason cited for retaining Russell is to maintain continuity of the investment program, given the Investment staff's outstanding performance since Russell took over the general consulting relationship.
    At the Investment Committee's request, the board will also seek Russell's input on other organizational issues that have not been included in past contracts, such as the actuarial rate of return and the pricing of liabilities. The board will direct Russell to focus on high-level issues such as investment policy, asset allocation and risk budgeting, and less on performance reporting. This new structure is expected to result in a significant cost savings.

    Ohio members participating in the Defined Contribution Plan or Combined Plan have the option of allocating their contributions to the STRS Total Guaranteed Return Choice. This option provides a guaranteed interest rate on contributions and transfers made in a given year. In exchange for this protection against any possible negative returns, participants must "lock in" their contributions and transfers until the end of a five-year term. The interest rate is paid on the contributions and transfers until the end of the five-year term and is credited to the account on a daily basis. For the STRS Total Guaranteed Return Choice
    2011, which begins on July 1, 2006, the Retirement Board approved an interest rate of 5.5%, which represents a premium above the five-year Treasury rate.
    As of April 30, 2006, there are 9,617 members in the Defined Contribution Plan and 5,753 members in the Combined Plan. Total assets in the defined contribution accounts exceed $222 million.

    The Retirement Board appointed two physicians to serve on the Medical Review Board, effective May 19, 2006. The new appointees are James N. Allen, Jr., M.D. with The Ohio State University Medical Center's Division of Pulmonary and Critical Care Medicine at University Hospital East, and Stephen F. Pariser, M.D. with The Ohio State University Medical Center's Department of Psychiatry.

    The Retirement Board approved the following retirements and investment transactions:
    - 43 disability retirements were granted.
    - 73 active members were approved for service retirement; 75 inactive retirements were approved.
    - In April, fixed-income purchases totaled $944 million, domestic equity purchases totaled $516 million and real estate purchases totaled $29 million.

    On May 10, STRS Ohio presented the statutorily required report to the Ohio Retirement Study Council (ORSC) on the Retirement Board's plan for reducing the pension funding period to 30 years from the current 55.5 years. Dr. Asbury explained the current situation facing STRS Ohio pension funding of decreased payroll growth due to school budget cuts and the impact of charter schools. The plan presented includes increases in both employer and member contributions and strengthens pension solvency while shoring up health care to achieve a 30-year funding period for both funds.

    Sunday, May 21, 2006

    Tom Curtis: Letter to legislators on ethics issues

    May 21, 2006
    Hello Representative [or Senator],
    This message comes from a retired teacher who has been highly involved for the past 3 years in helping to bring about the much needed reform at the STRS. I have worked side by side with Dr. Dennis Leone, the whistle blower who brought the STRS misspending to light.
    I realize I may not be in your district, but I reach hundreds of thousands of STRS members by email everyday. You can be assured that we are very conscious about ethics violations and blame many Ohio government officials for turning their backs on us.
    Two former fiduciaries of the STRS have been found guilty of ethics violations to date, with many more awaiting the same fate. However, those convictions do nothing to replace the millions of dollars misspent by these fiduciaries.
    Ethics violations are becoming far too common and are reaching epidemic proportion. Our state is the laughing stock of the country concerning this issue.
    You hold a position that could help to call for the remedy of much of this. Yet, neither of the bills currently being considered by the House and the one passed by the Senate address the ethics issue properly.
    Neither bill includes provisions for enforcement nor outside monitoring, which is where current rules governing lobbying really fall down.
    As stated by Fred Wertheimer, a Washington reform coalition head, "The bill does nothing about fixing the scandalous, failed House ethics enforcement system, nothing about preventing corporations from making company planes available to members at deeply discounted costs, nothing about providing the public with information about the fundraisers lobbyists hold for members, the parties they finance to 'honor' members, and the conferences and retreats held by members for which the lobbyists pay, and nothing about providing the public with information about the huge sums being secretly spent by professional lobbying firms on campaigns to stimulate lobbying by the public, including multimillion dollar advertising campaigns."
    You were elected to your position to do better then this. Please take your oath to heart and address this issue of ethics properly, instead of passing a bill that is basically useless for the sake of passing something.
    Again, I realize I may not live in your district, but teachers alone represent 430,000 votes. I have contact by email with many of them almost daily.
    Best Regards,
    Thomas Curtis,
    Life Member of the STRS, CORE, ORTA, SCRTA & AARP
    Larry KehresMount Union Collge
    Division III
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