Amid Bribery Scandal, Suspended Top Investment Officer Leaves CalPERS

(August 30, 2010) — Leon Shahinian, a former senior investment officer at the $205 billion California Public Employees Retirement System (CalPERS), has resigned.

CalPERS Chief Investment Officer Joe Dear will take over Shahinian’s duties while the pension fund searches for a replacement, fund spokesperson Clark McKinley told ai5000.

According to The Sacramento Bee, Shahinian, who wasn’t accused of wrongdoing in the suit, plans to pursue opportunities in the private sector and has a variety of offers he is weighing. He had been on paid administrative leave from the largest US public pension fund since May, The Bee said, when Shahinian appeared in a civil lawsuit filed by California Attorney General Jerry Brown against Al Villalobos and former CalPERS Chief Executive Fred Buenrostro.

Brown’s office claimed Villalobos had tried to bribe Shahinian, who oversaw the Alternative Investment Management Program at CalPERS, and that Buenrostro instructed Shahinian to build a closer relationship with Villalobos, who was attempting to persuade the fund to buy an equity stake in Apollo Global Management.

Weeks after Shahinian’s all-expenses-paid junket to New York in 2007, without disclosing the trip, Shahinian persuaded CalPERS to invest $600 million with one of Villalobos’ clients, Apollo Global Management. The deal generated a $13 million commission for Villalobos.