What? Here we go again. A new report accuses the state pension system of very questionable practices that led to the purchase of a 1.9-acre property for $752,000 in 2006 from a local veterinarian that had paid only $450,000 for it just three months earlier. Huh? The property was sold this year to the Kentucky State Police for $325,000. Wow!
This is fundamental incompetence in the oversight of other peoples' money. But apparently KRS executive director Mike Burnside thinks the matter is closed because key people involved are no longer involved.
Many processes failed before the people involved in implementing them failed. The hiring process failed when people were hired without fundamental competencies and experience to professionally evaluate all aspects of the deal. Kentuckians should be demanding to know what checks and balances are built into Kentucky Retirement Systems' processes for analyzing, justifying and approving investments, as well as assessing conflicts of interests, defining requirements for assumptions and analysis that will be provided to the board and ensuring necessary transparency is available as needed?
Putting the finger on people is one thing but the spotlight needs to be put on fundamental internal process requirements or lack thereof. Holding the Kentucky Retirement Systems' staff and the board accountable for the current state of internal processes would be a good start. If they are weak, it means another set of processes failed.
It is past time to take these organizations off automatic pilot and turn on the lights.
1 comment:
Looks like the same old story - nice jobs, good board positions and no accountability. I wonder when the last time was these people ever challenged themselves, looked into the detail, and decided processes needed some formality?
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