Federico Buenrostro Jr., former head of the California Public Employees' Retirement System, allegedly received the keys to a Lake Tahoe condominium and a six-figure salary when he left state service in 2008 to start work for an investment consulting firm, according to a civil fraud lawsuit filed last week by Attorney General Jerry Brown.
But he also received another bonus: Nearly $200,000 in unused vacation from California taxpayers.
According to a database we assembled for a story back in March, Buenrostro received among the 50 largest lump-sum payments made to retiring employees between 2006 and mid-2009. All told, he cashed out 217 days of leave for $199,989.83.
Brown's lawsuit – filed after an investigation into pension fund middlemen known as "placement agents" – alleges that Buenrostro accepted the condo, tens of thousands of dollars in gifts, and ultimately a private sector job, from another former CalPERS official, Alfred Villalobos, who was working as a middleman to steer pension fund investments to his clients.
Buenrostro began working for Villalobos' company, Arvco Capital Research, the day after he left CalPERS, according to the suit. The two also enjoyed lavish, round-the-world trips, including parties in cities as far-flung as Dubai.
Brown's office last week also obtained a court order to freeze Villalobos' assets, which include millions of dollars in property and luxury cars.
Last we checked, the state has no mechanism for reclaiming money payed for unused vacation – even if its recipient is ultimately convicted of wrongdoing.
Unused vacation time is regarded as a property right in California, meaning that once it is accrued and/or paid, state laws make it very difficult, if not impossible, to take back.
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