A former Macon-Bibb County manager has been charged with fraud for allegedly misleading pension boards because of a romantic interest in an investment firm’s consultant.
A U.S. Securities and Exchange Commission litigation release says former Bibb County Manager Dale Walker will pay a $10,000 fine and is no longer allowed to advise any government entity on pension or municipal security related activities as a result of the investigation involving three Macon-Bibb employee pension funds. Walker agreed to the civil penalty without admitting or denying the fraud charge made against him on Friday, the document said.
The Telegraph reported in March 2017 that emails appeared to show Walker steered the county’s $402 million pension business to investment adviser company, Florida-based Independent Portfolio Consultants, also known as IPC.
The emails led to concerns from some county leaders about Walker’s possible infatuation with then-IPC senior consultant Cheryl Underwood and how that may have played a role in that firm being selected to manage the pension plans.
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The SEC complaint does not specifically name Underwood or IPC. It does state that a colleague of a person Walker had a romantic interest in was given access to key documents.
“The SEC’s complaint alleges that Walker improperly provided an unfair competitive advantage to one investment adviser due to his romantic interest in an individual associated with the adviser,” the SEC litigation document states.
The SEC complaint says Walker never told members of the pension boards that he allowed anyone tied to IPC to see the proposals from other companies vying to also be the financial adviser for the the pensions. That person was also allowed by Walker to rank each firm.
In July 2014, Walker sent an email to Underwood stating that another then-Independent Portfolio employee, John Whitledge, had actually prepared the request for proposals for the three Macon-Bibb pension funds.
In doing so, Walker “undermined the integrity” of the selection process, the SEC complaint said.
“According to the complaint, Walker provided the confidential proposals of other investment adviser candidates and asked the associated individual to analyze and rank the candidates,” the SEC release said. “The completed analysis ranked (IPC) first above all other applicants.”
The three pension plans were the Division A of the Macon-Bibb County Pension and Retirement System (the plan for former city of Macon workers); the Macon-Bibb County Fire & Police Department Employees Retirement System; and the open Macon-Bibb County Pension Plan.
The SEC investigation was spurred after County Commissioners Gary Bechtel and Larry Schlesinger said they contacted the federal agency about concerns they had that the pension bidding process was rigged.
Walker resigned in 2017 from his position as county manager when the county uncovered emails related to the pensions and IPC after being notified of the SEC investigation.