The Investigation of Reynolds Williams and the $25 Billion S.C. Public Pension Fund Moves Forward
By Paul Gable
An investigation of alleged misconduct and conflict of interest against S.C. Retirement System Investment Commission chairman Reynolds Williams moved forward Tuesday when the S.C. Attorney General’s office requested SLED and the S.C. Ethics Commission to investigate the charges.
A Statement from AG Wilson’s Office: Based upon the nature of the allegations in the Treasurer’s letter, we are today forwarding the material we have on file to both SLED and the State Ethics Commission. (The Treasurer’s letter alleges activity that would fall under each authority, criminal and ethical.) When both entities have completed their reviews, we will then determine what, if any, prosecutorial action is warranted.
Enumerated in a letter from S.C. Treasurer Curtis Loftis to Attorney General Alan Wilson, the allegations stem from work Williams’ law firm did for American Timberlands, LLC while the company was being considered as a partner on an investment by the SCRSIC.
Included in Loftis’ letter is the concern that Williams used his position with the investment commission to steer work to two companies in which he is a partner.
According to Loftis’, the full scope of Williams’ companies’ work for American Timberlands, in preparation for the investment deal, was not disclosed until months after the investment was approved by the commission.
Williams was not present for the vote on the investment by the commission. According to Loftis, Williams said he would not have voted, if present, because he “MIGHT” have a conflict of interest. However, by the time the vote was taken, Williams’ firms had already completed the work for American Timberlands, meaning a conflict of interest already existed!
The question is should the investment ever have come before the commission for a vote considering the work Williams’ firms had already completed?
S.C. Code of Laws Section 9-16-350(A), states, “It is unlawful for a member, employee, or agent of the commission or anyone acting on its behalf to use any information concerning commission activities to obtain any economic interest for himself, a member of his immediate family, an individual with whom he is associated, or a business with which he is associated.”
Additionally, Section 9-16-360(B) states, “A fiduciary or employee of a fiduciary shall take no action: (2) to invest retirement system funds in any share, or other security if the fiduciary or employee of the fiduciary, their family, or their business associates have an interest in, are underwriters of, or receive any fees from the investment; (3) have no interest in the profits or receive any benefit from a contract entered into by the fiduciary; (4) not use their positions to secure, solicit, or accept things of value, including gifts, travel, meals and lodging, and consulting fees for payment for outside employment, from parties doing or seeking to do business with or who are interested in matters before the fiduciary.”
According to state law, “A person who violates the provisions of this section (9-16-350) is guilty of a felony and, upon conviction, must be imprisoned for not more than ten years and fined not more than one hundred thousand dollars.” And, “A breach of the standards provided in this section (9-16-360) is grounds for the removal of a commission member as a conflict of interest pursuant to the Governor’s removal powers under Section 1‑3‑240(C).”
Based upon our reading of the above statutes, the deal should have been dead as soon as Williams’ firms performed preparatory work for American Timberlands.
Messin with my money is like messin with my emotions…