and Texas and Florida Pensions
friends at BuzzFlash,
am very interested in your article on "Florida,
Enron, and Alliance Capital." I am very interested in getting
an investigation in Texas on Enron and the loss of Texas pension funds
in the amount of $60 million.
am a contributing member of Texas Teacher Retirement, with 23 years in
it now. So I was naturally concerned when Teacher Retirement (TRS) lost
36 million in Enron and (Texas) Employee Retirement System and Permanent
University Fund also lost millions. What is so suspicious is that TRS
bought Enron stock three times after word came out that Enron was in trouble.
refer you to the Austin American Statesman newspaper of Dec. 26, 2001,
front page story. I don't have a link for it other than the archives title:
available in the Austin American Statesman archives
(requires a paid registration)
am seeing a suspicious pattern here in the Bush states of Texas and Florida--were
state pension funds used to try to prop up a failing company which funneled
millions to the top officeholders of these states? Was someone told or
pressured to shore up Enron?
have written up my questions as a member of TRS in a piece which I have
sent to my state reps, my Dem. congressman, the heads of the two teacher
unions which I have ties to, and I have sent it to the Austin American
Statesman and Corpus Christi Caller Times to see if they might print it
as an op-ed piece which is not likely. I am hoping for a state investigation
by an outside prosecutor.
for your good work.
is what I wrote:
millions lost to Enron by Texas pension funds
loss of $35.7 million by Texas Teacher Retirement System in the collapse
of Enron affects more than current and retired teachers and staff. Money
lost from state pension funds comes from public school employees, college
employees, and ultimately from all Texas taxpayers because state funds
match employee contributions. Texas taxpayer monies flowed into Enron
in the last months as Enron awarded huge bonuses to top officials just
before declaring bankruptcy. Of all the Texas agencies, TRS had the
state-level investigation of Enron's dealings with Teacher Retirement
System is needed, particularly of the decision by TRS to invest in Enron
after the news was public that the company was in trouble. An outside
prosecutor is required because the top state officeholders received
large campaign contributions from Enron.
to the Austin-American Statesman December 26, 2001 article, Enron announced
$600 million losses on October 16, 2001, and Enron publicly acknowledged
a Securities and Exchange Commission inquiry October 22. The very next
day on October 23, TRS bought $2.2 million worth of Enron stock. October
24 the other state retirement system Employee Retirement System bought
$10 million worth of stock. It is very curious that two state agencies
would buy stock the two days immediately after bad news on Enron appeared.
October 31, SEC announced a formal investigation into Enron. On November
6, Enron stock dropped, and on November 8, Enron increased its debt
by $2.5 billion. Despite this very bad news, on November 9, TRS bought
$4.3 million of Enron stock, and on November 12, TRS bought $4.7 million
it possible that Texas retirement funds were being used in an attempt
to shore up a failing Texas company which had donated heavily to state
officeholders charged with overseeing Enron? Why did TRS buy risky stock
three times after it was known that Enron was in serious trouble? The
people of Texas have a right to know.
new laws may be needed forbidding TRS and ERS to invest in troubled
companies. State pension plans should not be making risky stock acquisitions.
of Texas teachers may retire in the next 5 years. The TRS losses this
year from Enron may cause a drop in benefits in the future no matter
what anyone says today. Large budget deficits are coming to the state
of Texas because of recent tax cuts. There may not be state monies available
when the system is under stress with large numbers of teachers retiring
to make up for the lost Enron money.
officials should have been doing their jobs in the first place by enforcing
the laws and not letting such a giant rip-off of state funds occur.
Unfortunately, too many of our state officials were in charge of overseeing
the very company that helped put them in office in the first place.
to Lobby Watch at website www.tpj.org/Lobby_Watch/enron.html,
Gov. Rick Perry, Attorney General John Cornyn, State Comptroller Carole
Keeton Rylander, and members of the Texas Supreme Court received sizeable
contributions from Enron. Obviously, this creates a conflict of interest
for these officials to investigate the company which gave them campaign
combined loss of $60 million from the two largest Texas pensions to
Enron is one of the most outrageous scandals in this state in decades.
A state-level independent investigation is needed into Enron and its
dealings with Teacher Retirement and Employee Retirement Systems, particularly
focusing on the decisions and policies of the Teacher Retirement System
which allowed it to invest three times in Enron after learning that
the company was in danger of bankruptcy.