Former Calpers CEO charged with fraud*

The SEC is accusing Fred Buenrostro, who was chief executive of California's giant pension fund from 2002 to 2008, and former board member (and former deputy mayor of Los Angeles) Alfred Villalobos, with falsifying letters that defrauded a private equity firm into paying $20 million in fees. From MarketWatch:

The SEC alleges that former CalPERS CEO Federico Buenrostro and his friend Alfred Villalobos fabricated documents given to New York-based buyout shop Apollo Global Management. The alleged false documents gave Apollo the false impression that CalPERS had reviewed and signed required disclosure letters that met the public pension fund's internal procedures, the SEC said. John McCoy, associate regional director of the SEC's Los Angeles unit, said Buenrostro tricked Apollo into paying more than $20 million in fees to Villalobos, a placement agent or matchmaker hired by the private equity firm. CalPERS has roughly $235 billion in assets.

*From the Sacramento Bee:

It was the second big legal action to come out of the Villalobos scandal. The two men were sued by the state of California in 2010; the case is still pending. CalPERS issued a statement applauding the lawsuit. "We condemn in the strongest way possible the alleged misconduct of these individuals, and pledge to continue working with all law enforcement authorities investigating these issues," said board President Rob Feckner. The pension fund has previously revealed that prosecutors are investigating possible criminal charges.