Report Exposes Mandel Single-Handedly Making Banking Decisions That Have Cost Ohio Workers Millions in Fees
COLUMBUS, OHIO – Recently, the Columbus Dispatch reported on a unique and questionable arrangement that gives State Treasurer Josh Mandel exclusive authority to decide which banks public pension funds use and what fees they must pay.
Some key facts include:
- The leadership of Ohio’s various pension funds has no authority in regard to the selection of the custodian bank for their respective funds, nor the selection criteria to use for decision-making. All power lies in the hands of Josh Mandel.
- In a recent incident, as a result of a change in custodians handling foreign investments for the Ohio Public Employees Retirement System, costs are rising from $75,000 a year to $3.5 million — a total increase in costs of $13.7 million over the four-year life of the contract.
- One national consultant who works in the industry said Ohio is the only state he knows of with this arrangement, “there are no other states with trustee boards where the board does not have the authority to contract directly with the custodial bank”
- Representatives from the state’s pension funds, which represent more than 400,000 recipients and beneficiaries, have sought a change in the law to remove the treasurer, citing potential political conflicts of interests arising.
- Anticipating an effort to strip the State Treasurer of this power, the Treasurer’s office has declared they would “fight that effort tooth and nail”
With power comes, or should come, responsibility, so the Ohio Democratic Party calls on Josh Mandel to do the following:
1) Publicly release all details surrounding the bidding process around any changes in this regard that have been considered, during the time he has been Treasurer.
2) Release all contributions that he has received in either his state or federal committees from any individuals associated with firms who have business, or who have sought business, from contracts which he has decision making power over.
3) Explain why the Treasurer feels he can make better banking decisions than the pension boards, who have the fiduciary responsibility for their retirees funds, even though outside consultants have suggested the Treasurer’s involvement could become unnecessarily political and consultants cannot name a single other state that has the same arrangement?
This is just the latest in a long list of incidents that causes head scratching as to what’s going on in the Treasurer’s office. During his failed Senate campaign, Ohioans learned of Mandel’s hiring of unqualified friends and political cronies to lucrative and important positions in the Treasurer’s office and Mandel’s complete failure to even show up at State Board of Deposit meetings his first year in office, choosing instead to campaign for a new job.
“Public workers already had plenty of reasons not to trust Josh Mandel, but now they also know that his sole authority over Ohio’s pension fund contracts is costing workers and retirees millions in fees. Mandel should be transparent concerning whether he’s used this power to his own advantage, and he should work with the pension funds and the Statehouse to ensure a more responsible division of authority going forward.
“It’s entirely unacceptable that that Josh Mandel has more power than any other Treasurer in the nation when it comes to deciding which banks Ohio’s public workers invest their pension funds in. His decisions have cost retirees and workers millions of dollars in fees. Ohioans deserve immediate answers as to why,” said Ohio Democratic Party Spokesman Jerid Kurtz.
Full Dispatch Piece HERE
ICYMI: Vindicator // Ohio Treasurer Plays With Fire By Keeping Control of Pensions