Moore: Siedle Award Underscores His Credibility
Monday, July 24, 2017
That’s how Governor Gina Raimondo so ineloquently referred to him several years ago when he began leading the charge to expose how she, as Treasurer, transferred hundreds of millions of dollars in wealth from the Rhode Island pension fund into the deep pockets of Wall Street money managers.
But when you’re on the losing side of an argument, I guess that’s what you do--make an ad hominem attack. Attack the man, not the argument. Doing the right thing--you know, what’s best for everyone and just--would be unthought of, apparently.
GoLocal reported on Friday that Siedle is in line for a massive payout from the SEC (Securities and Exchange Commission), somewhere in the ballpark of $48 million. Siedle is slated for the award because he exposed the fact that mega bank JPMorgan failed to alert its clients that it was steering their money into investments that would be most profitable to the bank.
The tips, one from Siedle, led to an enforcement action by the SEC that forced JPMorgan to pay a $300 million settlement.
When Ted Siedle talks, smart people listen.
The SEC program rewards and incentivizes individuals who come forward with information that would protect investors. It’s a sensible program. People who do the right thing deserve to be rewarded.
Rhode Island should create and implement some sort of a program that would reward individuals who provide information that would root out waste, fraud, and abuse in state government programs. That would save the state money.
Of course, if we had such a program in place, we’d probably be paying Siedle as well.
In 2013, when Raimondo began reshaping the pension fund investment strategy by diverting money away from traditional, most cost effective so-called “passive” investments that largely mirror the performance of the stock market into the highly opaque world of hedge funds with mammoth fees, Siedle cried foul.
Siedle On Point
At the same time, the state undertook pension fund reforms that scaled back the benefits that teachers and state workers would expect to earn going forward. A large portion of the money that was saved from those reforms went out the door to Wall Street.
But what about the pension fund’s performance? Do you get what you pay for?
Of course not. The state pension fund performed poorly when compared to its peers after switching over to the hedge fund investments.
Current Rhode Island General Treasurer Seth Magaziner--a Raimondo ally, no less--announced a new investment strategy last year called “back to basics." It’s more or less a return to lower cost investments that, ironically, deliver better performance.
Let’s face it: it’s a de facto acknowledgement that Siedle (and other critics) were right all along.
But here, there will be no awards, or monetary rewards, or even a thank you to Siedle.
Still, doing the right this is the best option because in the end, good things happen to good people.
This SEC reward to Siedle should serve as proof positive.
Related Slideshow: The Highest Paid Early Retirees in the RI Pension System
Below are the top 20 highest paid retirees in the state pension system who retired at age 45 or younger. Data are current as of June 30, 2014 and were obtained directly from the General Treasurer’s office. Estimates of age and annual pension are GoLocalProv calculations. Ages were calculated by comparing birth year with retirement year. The data did not include months and dates for either. The annual pension and total amount paid since retirement are provided for each. Retirees are listed in order of lowest paid, of the top 20, to the highest.
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