X-CalPERS CEO Guilty in Bribery Conspiracy

The former CEO of the country’s largest public employee pension fund pleaded guilty Friday to taking bribes to influence investment in the CalPERS pension program.

Fred Buenrostro admitted conspiring to receive $250,000 as well as gifts, international travel, entertainment and payment for Buenrostro’s wedding in exchange for investment in private equity funds.

Buenrostro, who left CalPERS in 2008, pled guilty to conspiring with Alfred Villalobos, founder of ARVCO Capital Research, a placement agent that solicited investment by public pension funds into private equity funds.

After receiving secret gifts from Villalobos, Buenrostro admitted he used his position to influence CalPERS investment staff and board to invest with current and prospective clients of Villalobos.

He also provided Villalobos with access to CalPERS’ confidential information related to investments and internal deliberations, according to the U.S. Attorney.

In one instance, Villalobos secured fees for ARVCO from Apollo Global Management, a private equity firm based in New York City that secured $3 billion in investments by CalPERS.

The two men conspired to create fraudulent documents and investment disclosure letters, in exchange Apollo paid ARVCO roughly $14 million fees.

Buenrostro will be sentenced Jan. 7, 2015 by U.S. District Judge Charles Breyer.

A status conference in the case against Villalobos will be Aug. 8, before Breyer.

Case: U.S. v. Buenrostro,  No. CR13-169CRB


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