Charles Millard, Former PBGC Head, Exonerated

(June 1, 2010) – Charles Millard, the former head of the Pension Benefit Guarantee Corporation (PBGC), has been exonerated relating to his allegedly contact with investment firms during his tenure at the nation’s pension insurance fund.

In a letter addressed to Senator Chuck Grassley (R-Iowa), Rebecca Anne Batts, the PBGC inspector general, wrote that “my office has concluded its investigation with the United States Attorneys’ Office for the Southern District of New York, and no charges will be filed.”

The inquiry stemmed from “former Director Millard’s contact with the companies and executives involved with the award of the Strategic Partnership contracts,” Batts wrote. According to Batts’ 2008 report, Millard intervened in the evaluation of Goldman Sachs, JP Morgan Chase, and Blackrock at the same time as these firms were bidding for the right to manage a $2.5 billion chunk of PBGC’s assets. Millard was also accused of receiving assistance in finding a job for when his tenure was done from a Goldman Sachs employee. With the official exoneration from the Inspector General, however, no charges will be brought relating to either matter.

Before his term expired in January 2009, Millard proposed and received Board approval of a reform of the Corporation’s asset allocation. In February of 2008, the Secretaries of Labor, Commerce, and Treasury – the agency’s three-member Board – approved a move that would see its then-$55 billion allocated 45% to equities, 45% to fixed-income, and 10% to alternatives. While the plan was not implemented in its entirety before the end of his term – or, for that matter, before the equity crash seen in 2008 – Millard’s 20-month tenure saw the unfunded liability of the Corporation decrease from $18.9 billion to $11.2 billion.