ALBANY — Gov. Cuomo’s administration escalated its long simmering feud with state Controller Thomas DiNapoli on Monday, issuing a scathing report on his management of the state pension fund.
The report from Department of Financial Services Superintendent Maria T. Vullo blasted the controller for repeatedly investing in underperforming hedge funds that charged excessive management fees.
Vullo said DiNapoli continued to pour money into the hedge funds even after it became apparent they were losing money, costing the pension fund $3.8 billion in losses and fees since 2008.
The report also slammed DiNapoli for a lack of transparency in the use of the hedge funds.
“Given the $3.8 billion hole the comptroller’s hedge fund gamble already has dug for the state pension system, taking away the checkbook may be the only way to safeguard the pensions of state employees, and the pocketbooks of taxpayers on the hook for system deficits,” said Vullo.
A spokeswoman for DiNapoli rejected the report’s findings, arguing the pension fund has not invested money in hedge funds for over a year.
“It’s disappointing and shocking that a regulator would issue such an uninformed and unprofessional report,” said DiNapoli spokeswoman Jennifer Freeman, who added that the controller received a copy of the report just five minutes before it was released to the press.
“Unfortunately, the Department of Financial Services seems more interested in playing political games, so remains unaware of actions taken by what is one of the best managed and best funded public pension funds in the country,” Freeman said.