LACERA Terminates Goldman Mandate From Portfolio; Goldman Promises Greater Transparency to Dodge Conflicts of Interest

(January 14, 2011) — The Los Angeles County Employees Retirement Association (LACERA) has terminated Goldman Sachs Asset Management, which ran $560 million in core-plus fixed income.

The money will now be moved to BlackRock’s $514 million passively managed fixed-income portfolio, raising it to $1.074 billion, Pensions & Investments reported.

The move comes after Goldman’s promise to become more transparent about how it does business following accusations that the bank sacrificed its clients’ interests for their own. The New York investment bank said in a report it would disclose more information about exactly how it earns money and as part of a $550 million settlement with the Securities and Exchange Commission in July, it has agreed to reform its business practices. Goldman described the review as “significant, encompassing every major business, region and activity of the firm,” yet the firm also indicated the changes would promote the strengthening of the company’s core principles as opposed to an overhaul of those principles.

Lloyd C. Blankfein, Chairman and CEO of The Goldman Sachs Group, Inc., said: “We believe the recommendations in this report represent a fundamental re-commitment of Goldman Sachs to our clients and to reputational excellence in everything the firm does.”