John Curry: Paying Cliffwater 250 THOUSAND DOLLARS per year to get insulted is a waste of money!

From John Curry

August 20, 2021

So....just who is this Stephen Nesbitt, the guy from Cliffwater who said at the August 19, 2021 STRS Board meeting that paying Wall Street tens of millions of dollars to do nothing (fees on committed uninvested capital) is no different from paying teachers over the summer months? Well.....here's how Stephen describes himself and his business:

"We advise pensions and endowments. Think of us as an institutional advisory and consulting firm. We cover alternative investments such as private debt, private equity, and hedge funds. Essentially anything that’s not stocks and bonds. We help institutional investors with portfolio construction."

I'd say paying Cliffwater 250 THOUSAND of STRS (your and my) dollars per year for advice is far too much to pay to be insulted. We, those very same insulted teachers, are paying Stephen's lunch ticket....and we need to drop this guy and his firm "like a hot potato!"

If you'd like to give Mr. Nesbitt a piece of your mind here is his email: snesbitt@cliffwater.com
P.S. Nesbitt is the CEO of Cliffwater LLC.

P.S.2 I have some FREE advice for STRS....get rid of all your alternative investments and you'd have no need to pay jerks like this to give you advice in the first place.

Letter to Stephen Nesbitt, CEO of Cliffwater LLC: You, sir, are part of the problem

My letter to Stephen Nesbitt of Cliffwater LLC, August 21, 2021:

Mr. Nesbitt, why is it so difficult for you to understand teachers do NOT get paid for doing nothing over the summer months? 

For my entire teaching career, I worked for nine months every year because the job was only available for nine months of the year. But I opted to have my pay for those nine months spread out over TWELVE months so that I could receive a steady income all year long. That meant accepting a smaller paycheck over twelve months instead of a larger paycheck over nine. Do the math. You will discover that a teacher's annual income for twelve months is exactly the SAME as if that teacher were paid over nine months. 

To compare teachers and Wall Street is comparing apples and oranges. Wall Street may rake in millions or billions for doing nothing. That's hardly the case with us! At least we can sleep at night with a clear conscience and our integrity intact, much more so than the weasels at places like Wall Street and Cliffwater, who all play a part in fleecing those of us who work much harder for much less. We have lost millions since STRS's gross mismanagement and corruption robbed us of our COLA (yet has kept adding millions to their own pockets at the same time). You, sir, are part of the problem. I hope Cliffwater never steps foot in STRS again. 

Kathie Bracy 

STRS Ohio Stakeholder

A MUST HEAR: Robin Rayfield's address to the Warren County Retired Teachers Assn., August 4, 2021

What the heck is going on at STRS?

Robin Rayfield, executive director of the Ohio Retired Teachers Association (ORTA) outlines very clearly what has REALLY been going on at STRS all these years, and how it can be fixed. Not for the faint-hearted.

https://www.youtube.com/watch?v=vpBdTHqkMGI 

Closed captioning is available. On your computer, click on CC at lower right corner of your screen when you start the video. This feature may not be available on your smart phone or your tablet.

ORTA Advocates for Ohio's Teachers: Active and Retired

From Cindy Murphy

August 21, 2021

Wondering whether or not you should join ORTA?

Watch Robin Rayfield’s presentation to members of the Warren County RTA.

• Suspension of the COLA
• Employee contributions
• Forensic audit conducted by Edward Siedle
• Lack of transparency at STRS
• Systemic corruption at STRS
• Benchmarks and bonuses at STRS
• ORSC’s lack of oversight
• Rudy Fichtenbaum’s plan to reduce risk and restore our pension benefits
• Active versus passive investing
• Gannett and Apollo and lack of media coverage
• Panda Power and STRS Ohio’s $525 million loss
• STRS Ohio’s real estate investments
• POP5
  

“I don’t have any faith or trust in what the STRS people tell me. The leadership, the culture at STRS is broken, in my mind, beyond repair” - Robin Rayfield

Watch Robin Rayfield's presentation: https://youtu.be/vpBdTHqkMGI 

The STRS Ohio Watchdogs is a grassroots organization of teachers in Ohio advocating for prudent and transparent managment of STRS Ohio.
Visit our website: https://www.strsohiowatchdogs.com
Join our Facebook group: 

https://www.facebook.com/groups/STRSOhioWatchdogs
Follow us on Twitter: https://twitter.com/strsohwatchdogs
Contact us: strsohiowatchdogs@gmail.com
Join the Ohio Retired Teachers Assocation: https://www.orta.org

Remarks following the August 2021 STRS Board meeting

 August 19, 2021

(Author unknown)

STRS provided a rebuttal to the forensic audit.. But, most of the rebuttal did not provide many specifics with transparent substantiating evidence!

Retirees who spoke to the board after the report still had concerns.

Robin Rayfield, executive director of the Ohio Retired Teachers Association, said retirees and the system have "dueling experts" and that the solution is for STRS to provide more transparency by complying with record requests and providing information about alternative investments and their exact costs.

"Just tell us," he said. "We'll probably go away if what you're telling us is accurate. You folks trust these people. You trust them. You believe in them. These folks do not."

"If you give us the information, you have it, just click send, we'll get out of your hair. It's a simple solution," he added.

Other retirees called for the restoration of the COLA, saying it isn't right for staff and investment managers to receive bonuses when retirees aren't getting the increases they were promised.

Denny Jordan, a retired teacher from Wooster High School, said he has been a "model retiree" since his retirement and that costs have increased.

"I was wondering if as a model retiree if I could qualify for a performance-based bonus, kind of like the kind the STRS investment staff have been getting," he said. "I think a COLA would be easier, but a performance bonus would be nice, too."

Bob Buerkle said the discount rates suggested by consultants have long been pessimistic and ended up well below actual returns, meaning the board has cut benefits when not needed.

"Now comes Callan again, spouting the same prediction for the next 10 years, assuming that STRS might only earn 7%, and that would be on the high side. You took their advice aboard, despite earning 29% last year," he said. "I believe Callan needs to be replaced. Nobody can be right all the time, but Callan hasn't been right any time."

State Senator Teresa Fedor to STRS Board: Reinstate the COLA immediately, and make cuts to salaries and bonuses if that is what it takes

 

Damschroder: If STRS management manipulated data to put millions in their pockets, they belong in prison not in charge of 500,000 citizens' retirement.

Fremont News Messenger

Damschroder: Where's the auditor?

John Damschroder, 

Columnist

 

 

 

August 18, 2021

The wisdom of Lincoln was on display when the Ohio Retirement Study Council-ORSC met at the Statehouse on Aug. 12. “In this country, public sentiment is everything.  With it, nothing can fail; without it nothing can succeed. Whoever molds public sentiment goes deeper than he who enacts statutes, or pronounces judicial decisions,” is a Lincoln philosophy still true today.

The large and fast growing social media presence of tens of thousands of beneficiaries of the Ohio public pension system was clearly on the mind of ORSC members who noted the barrage of emails as they finally voted to have fiduciary and actuarial audits due by law in 2016, performed for delivery in 2022. 

Funston Advisory Services was selected as the fiduciary auditor for both the State Teachers Retirement System-STRS and the Ohio Police and Fire Pension Fund-OPFPF, at a cost of $1,422,000, fees a half-million dollars more than another bidder for both contracts. ORSC Chairman, state Rep. Rick Carfagna, a Republican from suburban Columbus, indicated the Funston writing style was the significant difference.

More:Damschroder: DeWine's view of corruption makes him look like Mr. Magoo

The writing style in the two month old, teacher funded, forensic audit of STRS didn’t have the same impact on Chairman Carfagna. When the 128-page document authored by securities attorney and public pension expert, Edward Siedle was suggested as an agenda item for the next ORSC meeting, Carfagna said he didn’t find much data in the document.

Uncomfortable, granular detail in Siedle report

In reality there is uncomfortable, granular detail in the Siedle report, including harsh criticism of the ORSC breakdown in oversight that originates in clear violations of Ohio law. The latest example of Ohio’s systemic breakdown in public pension oversight comes in response to Siedle’s conclusion that STRS routinely under reports fees to investment managers to overstate performance results.

Fremont native, Certified Public Accountant-CPA Wade Steen, twice appointed to the STRS Board as the governor’s representative, has written to fellow board members with a 10-point graphic showing STRS documents that reveal $163 million in investment costs was shaved from results to qualify staff for $7.8 million in bonuses. Steen also has written STRS leadership saying the information behind staff bonuses, due to be voted on tomorrow, is insufficient as evidence of performance to earn the bonuses.

More:Damschroder: Transformational or delusional, let the debate begin

This column was first to note the allegations of manipulated data in the STRS financial reports, but big city Ohio newspapers have also covered both the Siedle report and the Steen question on whether performance or fraud is behind the bonus pool. This an issue that goes way beyond $7.8 million, in that potential fraud anywhere raises questions everywhere with a $94 billion pension.

Normally those questions would be answered by the Auditor of State. Currently that’s Keith Faber. “The Auditor of State did not audit the accompanying financial statements and, accordingly, we are unable to express, and do not express an opinion on them,” said Faber who farmed the project out to CliftonLarsonAllen LLP of Toledo.

The contract auditor’s statement said; “This report consists of management’s representations regarding STRS Ohio’s finances. Management assumes full responsibility for the completeness and reliability of all information presented in this report.”

It's time for unit to follow the evidence

Since the only source of information on STRS stewardship of $94 billion is of questionable reliability, it’s time for the Auditor’s Special Investigations Unit to follow the evidence in Steen’s 10-point map to data manipulation he says was behind the $7.8 million pot of gold for STRS staff.

To force the issue I sent the graphic to Auditor Faber’s SIU team and his public affairs unit, while enlisting the social media army of Ohio pension beneficiaries to do the same.  Within minutes the pension groups were flooding the Auditor’s Office with demands for an investigation.

Frankly, it’s the sort of thing the Auditor should have been all over the minute it hit the newspapers.  It should have been the first item of new business on the Ohio Retirement Study Council agenda, and Wade Steen’s first email should have been to the auditor. 

If STRS management manipulated data to put millions in their pockets, they belong in prison not in charge of 500,000 citizens' retirement. If the Steen document is wrong, it needs to be debunked ASAP by someone with credibility, like the Auditor’s SIU team.  If they fail to perform as ORSC has over the years, the FBI will be the next alternative, although pension expert Siedle advises not to expect much help.

John Damschroder, a Fremont native who worked in Gov. George Voinovich’s administration, writes about business and economic development in Ohio.

An alternative explanation: Why Ohio teachers are paying more, working longer and getting less: WALL STREET TOOK THE MONEY

Source: State Teachers Retirement System of Ohio financial report and Ohio Retirement Study Council semi-annual investment performance reports

HPA asks STRS Board to investigate Ted Siedle's findings and communicate results openly with members

 

Overheard.....

"There is no public pension in the US getting close to these types of bonus payments. How does this continue?"

No truer words have ever been spoken! (Sound familiar?)

https://www.forbes.com/sites/edwardsiedle/2021/08/16/public-pension-looters-need-not-fear-fbi-and-law-enforcement/? 

3 Hallmarks of High-Level Investment Fraud      

Nobody ever admits guilt.·      

Nobody ever goes to jail.·      

Nobody ever pays back all the money they have stolen.

~ Edward Siedle

Oh my! Some Board members must really LOVE to travel (on our dime, of course)!!!

From John Curry

August 15, 2021

Don't you just love travel, transparency and fishing.....$233,000 worth? If you go fishing at the Checkbook.Ohio.gov Pond you can catch a lot of fish, can't you? Check out this catch. Apparently.....the fishing was great around Miami, wasn't it? STRS has a Dallas office...but no Miami office or Florida office! Florida is nice in the cool months, isn't it?

What would Dr. Dennis Leone (former STRS reformer) say about this? And Nevada Public Employees Investment System ONLY has 2 employees????? What's wrong with this picture?

P.S. It sure is fun to "whip out the plastic," isn't it? It's definitely fun when someone else is paying the bill....like STRS stakeholders!

Hi, Nick!