Ohio’s attorney general is opening an investigation into the state’s teacher retirement system

COLUMBUS, Ohio (WSYX) — Ohio Attorney General Dave Yost announced Thursday that he is opening an investigation into the State Teachers Retirement System.

The move comes after Gov. Mike DeWine raised serious questions about how the pension system works and who provides crucial oversight.

Governor DeWine issued the following statement:

“I have been closely following ongoing news regarding the Ohio State Teachers Retirement System (STRS). Our public pension systems have a duty to retirees to ensure that their investment portfolios and accounts are stable and financially sound so that they have the financial means to serve retirees now and in the future.

“I have supported the efforts of Ohio Auditor of State Keith Faber and the Ohio Retirement Study Council to conduct numerous audits to ensure that STRS is providing the best management and oversight of their retirement funds. These reviews have resulted in several dozen recommendations to “improve fiduciary performance,” including “improvements to STRS use of committees, a “revitalization” of the investment and audit committees, and the creation of a board governance committee.” that STRS hired a nationally known consulting firm, Aon, to provide corporate governance advice.

“We recently learned that Aon is terminating its contract with STRS. This is a major red flag that calls into question the functioning and oversight of STRS. The unstated conclusion is that the governance issues at STRS are so worrisome that Aon was unable to continue.” Due to Aon’s termination of the contract, STRS may no longer comply with portions of the audit recommendations.

“In addition, my office has received documents containing several other troubling allegations regarding the STRS board. I have directed my staff to forward these documents to a number of relevant offices, including the Ohio Ethics Commission, the Ohio Retirement Study Council, Attorney General Yost, Comptroller Faber, Treasurer Sprague, Secretary LaRose, and relevant members of the Ohio General Assembly. I encourage them, to review the document and take any action that may be appropriate within their jurisdiction.

ABC 6 Investigators began investigating the STRS’s investment practices in September of last year.

STRS provides services to half a million educators in Ohio and manages a $91 billion fund.

6 On Your Side investigators discovered that STRS invests in nearly 2,000 companies, from Amazon to Apple and Kroger.

In the previous ABC 6 Investigation last September, STRS Ohio told ABC 6 that the company has a diversified portfolio and does not comment on the investment strategy for specific stocks.

But now Gov. DeWine is demanding answers, citing recent audits that push for improvements in his board’s performance and oversight.

The governor’s office also obtained documents it shared with ABC 6 detailing what Gov. DeWine describes as disturbing allegations against the STRS board.

On Thursday, Ohio Attorney General Day Yost announced he would respond to the governor’s concerns and launch an investigation into the actions of the teachers’ retirement board.

Yost’s office released the following statement:

“Pension board members are required by law to act in the best interests of the teachers whose money they invest,” Yost said. “I will take all necessary measures to protect teachers from private interests seeking to hijack their retirement accounts.”

Yost is actively investigating the current Trust Removal Law (ORC 109.98) to address potential violations by STRS Board members. The investigation is consistent with Yost’s commitment to root out all public corruption and instances of greed and fraud in public institutions.

“This is not monopoly money; It’s the hard-earned income that belongs to teachers,” Yost said. “There is a responsibility to act in their best interests.”

The Attorney General’s Office has obtained documents containing disturbing allegations about the STRS board. In response, Yost will conduct a thorough and impartial investigation of these matters and take all necessary actions to maintain public trust in our government institutions.

Dale Price, CEO of STRS Ohio, released a response to Governor DeWine’s concerns:

“Recent audits show that STRS Ohio is well managed and that the pension fund is in sound financial condition.

The questions raised concern board leadership. Classroom teachers and retired educators should know that their retirement is safe and secure.

STRS Ohio will continue to protect the stability and integrity of the organization and will cooperate fully with all agencies in the review of the pension system.”