COLUMBIA — State Treasurer Curtis Loftis is refusing to sign a $50 million check for an investment approved by the commission that oversees the state retirement fund.
Loftis, the commission’s only elected member, voted for the investment with private equity firm Warburg Pincus. But he wants a paper copy of a document to assure the state won’t overpay fees, rather than the e-mail version he received, The State newspaper reported.
“They want to fund a $50 million investment with retirees’ money. I say to them, ‘I will fund it when it is safe,’ ” Loftis said.
The Retirement System Investment Commission’s chief operating officer said all commissioners received an e-mail with the fee information. Loftis wants a copy signed by the commission’s attorney.
“He’s trying to unilaterally create a new document that currently doesn’t exist,” Darry Oliver, the commission’s chief operating officer, said. “The commission doesn’t believe he is entitled to do that.”
Commission Chairman Reynolds Williams said he hopes Loftis will “come to his senses” before the bank requests the money next week.
As treasurer, Loftis is the official custodian of the state’s money, meaning he is the only one who can sign the check. If he continues to refuse, the two sides could end up in court.
It’s the latest episode in a feud between Loftis and his fellow commissioners, particularly Williams, who Loftis tried to remove last year as chairman.
The first-term treasurer has complained for more than a year that the commission pays too much in management fees for its investments. But other commissioners say the fees serve as incentives for managers to invest wisely, with bonuses given for successes.
Investments are the main source of income for the nearly $27 billion fund that pays retirement benefits to government workers.
Oliver, in the job for less than a month, said he worries Loftis’ refusal to pay for an approved investment will hurt the state’s reputation in the financial world.
“In my 30 years of doing business, I haven’t seen anything like what I’ve experienced between the commission and the treasurer’s office like I have in the past three weeks,” he said.
Loftis has threatened for months to stop writing checks on signed investment contracts. The threat initially involved his demand that the commission give his treasurer’s office staff full access to all contracts. Access had been limited to commissioners and that agency’s staff, with the commission citing confidentiality agreements.
Last month, the commission voted to censure Loftis for what it called “false, misleading and deceitful” comments. Loftis said that he would not be silenced.
He made good on that promise Thursday: “The commission has failed to adequately provide documentation showing that the custody arrangements of our investments are safe,” he said in a release. “This is not Monopoly money. It is your money, and I will treat it like it is my own.”
Williams said it’s time for the commission to stop putting up with Loftis’ “malarkey.”