Oregon Treasury Doesn't Know, Doesn't Care It's Invested In Risky Crypto!
Treasury Says It "Does Not Possess Thorough Look Through Ability" to Verify Crypto Holdings
Recently I was interviewed by a reporter from Oregon about the state’s aggressive investment strategy for its $100 billion public pension fund, one that is now massively skewed (60%) toward so-called alternative investments—specifically, private equity funds. I flippantly observed that, in addition to any other risky investments, I was confidant, based upon my experience, that the pension had crypto-related investments which it did not know about and was not monitoring. The reporter was incredulous.
So, on August 5th I submitted the following request for public records to the Oregon State Treasury:
"I am writing about whether Oregon's pension is invested, directly or indirectly (through funds), in crypto-related assets. Could you please provide information as to the extent of the pension's crypto-related assets--funds and amounts? "
Here’s the reply I got:
Oregon State Treasury does not have any direct exposure or investment in cryptocurrency/digital assets.
Treasury does, however, invest in Public Equities related to cryptocurrency/digital assets such as Coinbase, Block, and Tesla. A list of these are posted annually in our Public Equities Holding report available on our Performance and Holdings page. That page is available here: https://www.oregon.gov/treasury/invested-for-oregon/pages/performance-holdings.aspx
You can may also benefit from reviewing Treasury's monthly filing with the SEC available on SEC's webpage: https://www.sec.gov/edgar/browse/?CIK=1107314
Additionally, Treasury may have further secondary exposure in externally-managed hedge funds. However, we do not possess thorough look through ability to verify those.
I note with great emphasis: “We do not possess thorough look through ability.”
That’s the first time I’ve ever heard those confusing words. Here’s a translation:
State pension fiduciaries have failed to demand that external investment managers disclose to the pension on a timely basis all investments, including but not limited to crypto, in their funds’ portfolios.
State pension fiduciaries have failed to disclose to Oregonians information they don’t possess regarding the pension’s riskiest investments.
State pension fiduciaries cannot be monitoring the risks related to crypto investments they do not know they own.
Bad enough that the Oregon State Treasury is gambling $60 billion in high-cost, high-risk alternative funds. State officials don’t know—and apparently don’t even care—what’s in those funds.
I know and I care—and, if you are a Oregon pension stakeholder, so should you.