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The Nose

Exotic Ethics

Posted 4/12/2006

A recent report obtained by the Nose on Baltimore’s city employee pension system by the nonprofit, right-leaning Calvert Institute for Policy Research suggests that the pension board is a less than serious custodian of the $1 billion-plus under its control.

The report, dated March 23, reveals that the city Employees’ Retirement System’s fund manager, Callen Associates, has been sued by the city of San Diego for failure to disclose conflicts of interest, and that investment income on the city employee pension fund has fallen some $33 million short of benchmarks—although the huge fund is still solvent.

The report criticizes the system’s Board of Trustees as “amateur” but gives few details. Turns out that members of the city pension board have taken some seminars—occasionally to exotic locales—in order to improve their knowledge in the arcane field of high finance.

In November of 2003, for example, Comptroller Joan Pratt and four city pension trustees (at least one of whom brought her husband) attended a seminar at the Westin Rio Mar Beach Resort and Golf Club in Puerto Rico, according to the candid photos in the newsletter of the National Association of Securities Professionals.

Pension trustees traveled to Monte Carlo last Oct. 26-28 for the “European Alternative and Institutional Investing Summit,” presented by the Opal Financial Group. Most public pension funds sent one or two representatives to the event. Baltimore’s contingent numbered seven, according to the brochure: executive director Roselyn Spencer and six of the seven board members.

Only one board member—Ernest Glinka, whose board membership extends until December 2007—did not attend. And he will likely not be attending any future junkets, according to his very unusual financial disclosure statement filing with the Baltimore City Ethics Board:

“I did not attend any ‘Client Conferences’ such as those sponsored by MDL Capital, Williams Capital, Bank of Ireland or any other manager,” Glinka handwrote in an addendum attached to his 2004 filing (the latest available). “I did not attend any ‘Industry Sponsored Conferences’ such as those put on by Opal, Callan, NAJP, NAIC, etc.

“I did not request or accept any fees, accommodation, etc. for speaking before any groups.

“I did not request or accept any meals, entertainment, tickets to sporting events, golf, etc. from any entities doing business with the Employees Retirement System.”

Glinka wrote that all perishable gifts sent to him were distributed to the pension plan staff and all nonperishable items were given to charity—but for one: a “mini maglite from Attalus Capital which I retained for use on my boat.”

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