Investigators hired by the trustees not only added new charges against Theobald, they endorsed previously leveled allegations that Theobald had an improper relationship with a money manager seeking a $10 million pension system investment, the Associated Press reported.
Investigators found Theobald had accepted rent-free office space, meals and entertainment from one money manager and that he held an interest in several funds that did business with the retirement system. Finally, investigators said that two brokerage firms had relationships to Theobald’s own company, Maiden Lane.
“These relationships suggest that it was advantageous to Mr. Theobald’s ability to access pension and other funds and assets on behalf of Maiden Lane clients,” the report says.
In addition, investigators asserted that “Mr. Theobald’s use of the Board’s letterhead to solicit money from (retirement system) managers and consultants created at least an appearance of a conflict of interest in violation of the Code of Ethics as it reasonably could be interpreted as a ‘pay-to-play’ effort.”
Lucy Karl, a lawyer representing Theobald said he had cooperated with the investigation but had not seen the final report. “We understand that the New Hampshire Retirement System flourished financially under Ed’s leadership, and that there is no suggestion in the report that Ed financially benefited as a result of his chairmanship or that the system or its members suffered any financial losses as a result of his leadership,” said Karl, according to the news report. .
Governor John Lynch and the Executive Council voted to replace Theobald on the board of trustees in October and the new appointment, Charlton MacVeagh, became chairman.
The retirement system uses income from its in investments to pay pensions to 18,000 retired state, county and municipal workers, including teachers, police officers and firefighters. More than 50,000 current public employees contribute to the system.