SC Officials in Battle over Pension Fraud Monitoring Proposal

September 16, 2011 ( - The panel in charge of South Carolina's pension investments has rebuffed the state attorney general's plan to use law firms to monitor for possible fraud.

In addition, the Associated Press reports, state Treasurer Curtis Loftis accused Attorney General Alan Wilson of getting the state involved with a New York law firm whose political contributions have raised allegations of pay-to-play in other states for legal work. One of Wilson’s top deputies, John McIntosh, during a South Carolina Retirement Investment Commission meeting, said he didn’t know exactly what Wilson did.  

According to the AP, in an interview, Wilson dismissed the idea that $12,000 in contributions from partners in Labaton Sucharow of New York affected his decision to use that firm for the monitoring work. “I picked them because of their ability,” Wilson said. “There is no money. There is no contract….There’s no pay-to-play.”  

Loftis said it is up to him to decide whether lawyers would be hired for the commission, and Wilson’s role is limited to approving lawyers he suggested. Wilson, on the other hand, said Loftis had previously agreed to hire lawyers and left the decision to him.  

Commission Chairman Allen Gillespie said his panel was never told the plan was in the works and both elected officials are wrong. The agency already has its own fraud checking system and would decide if it’s ever needed to hire outside lawyers for that type of work.  

Commissioner Edward Giobbe said Wilson’s plans prompted worried calls about fraud at the agency. McIntosh said there was no intention to cause such worries, and told the commission it is up to them to decide whether any law firm is hired.