Feds Scrutinize Arizona PSPRS’ Real Estate Valuations
Feds scrutinize Arizona Public Safety’s real estate valuations
FBI, grand jury investigating pension fund dispute
By: Randy Diamond – Pensions and Investments – Published: January 22, 2014
The FBI is investigating whether senior officials of the $7.7 billion Arizona Public Safety Personnel Retirement System, Phoenix, improperly increased the value of a real estate investment made with Desert Troon.
In addition, a federal grand jury has been impaneled to examine the issue and hear testimony from at least one of three investment officers who resigned over the property value dispute, according to documents, interviews and sources.
Mark Selfridge, one of the three investment officers who resigned, said in an interview that FBI officials had questioned him recently about the valuation dispute. He didn’t provide details. Sources also said Paul Corens, another of the three investment officers who resigned, also was interviewed by the FBI.
Anton Orlich, the third investment officer who quit, has been ordered to appear before a U.S. grand jury in Phoenix on Feb. 11 and turn over electronic documents that he took before leaving the pension fund, according to legal documents filed with the Maricopa County Superior Court, Phoenix.
PSPRS officials have filed a civil suit against Mr. Orlich and are seeking the return of the same documents, which are being held by the Maricopa County court pending the resolution of the dispute.
Attorneys for Mr. Orlich are seeking the court’s permission to turn over the documents to the grand jury.
According to the court documents connected to the civil suit, the FBI had told Lynne Adams, Mr. Orlich’s attorney, that her client is neither the subject nor the target of the grand jury investigation. Ms. Adams said in the court documents that the FBI has met with Mr. Orlich to discuss his concerns about mismanagement of the pension fund.
It is unclear whether the FBI has interviewed a fourth person, the investment office’s former in-house counsel, who also resigned.
A spokesman for the FBI’s Phoenix office did not immediately return phone calls.
PSPRS officials were not available for comment.