Public Pensions Need Independent Inspectors General Says WSJ: CalPERS Retiree Concerns Cited

Our impending forensic investigation of CalPERS commissioned by retirees was cited in the published opinion.

These massive pools of money are ripe for fraud without oversight by nonpartisan watchdogs.

On September 3, 2025, the Wall Street Journal published the following opinion by Mark Lee Greenblatt who served as Interior Department inspector general, 2019-25. In his opinion letter, Greenblatt mentions our impending forensic investigation of CalPERS on behalf of the Retired Public Employees Association. (Recently, RPEA unsuccessfully pushed for the establishment of an inspector general for CalPERS—independent oversight which apparently neither California politicians nor other labor groups seem to want.)

Greenblatt opines, “There’s no downside to having independent inspectors general for public pensions.” Sadly, there’s plenty of downside—for politicians and Wall Street firms who control and manage these funds—if mismanagement is addressed. Neither political party can survive and prosper without the support of Wall Street. Money to fund the political process has to come from somewhere. Public pensions are the largest pools of assets in states, ripe for looting thanks to a growing lack of transparency. Public pension investment fees paid to Wall Street have skyrocketed, as billions are funneled to politicians and net investment returns plummet.

In conclusion, absent transparency and independent oversight, public pension investment performance will continue suffer, costing the nation trillions over time. It’s no mystery why not a single public pension in America—not a single one—has followed Warren Buffett’s sagely advice to invest index funds. Not a single public pension in America—not a single one—has outperformed, or even met, the index rate of return. Indeed, it seems there’s no downside to looting public pensions.

Here’s some of what Greenblatt had to say in the Wall Street Journal:

Wherever there’s public money, someone is trying steal it. Public pension funds, which manage $6.1 trillion, are no different. Improper disability claims, falsified records and outright fraud have led in recent years to prosecutions and recovered funds. Some larger states and systems have internal audit and ethics offices to investigate waste, fraud and abuse. But smaller states and systems often lack the resources or independence to pursue mistakes and wrongdoing. Every public pension fund needs some form of independent oversight.

These funds are inherently at risk of fraud. In May, the Los Angeles County Employees Retirement Association filed suit against a former information-technology security official for fraud, conflicts of interest and breach of fiduciary duty. In July, a former risk official with the Iowa Public Employees’ Retirement System sued the state with allegations of unfair termination for raising concerns about the fund’s investments and bookkeeping.

California retirees are seeking an outside audit of the $530 billion California Public Employees’ Retirement System. They’ve hired a forensic investigator and asked legislators for an inspector general to monitor Calpers.

Many states have established these offices to promote accountability and efficiency. Some have a statewide inspectors general, while others have oversight offices within agencies to bolster transparency and accountability.

At the federal level, inspectors general are the independent watchdogs responsible for preventing and detecting bad behavior in government agencies. They have clear authority and employ expert inspectors and auditors who improve agency efficiency, efficacy and integrity, ultimately protecting taxpayers.

Inspectors general are unique to the U.S. During my time in government, I regularly hosted foreign delegations interested in learning about the inspectors-general system and how it protects Americans. They marveled at our commitment to accountability and sought to emulate it in their countries.

Given the large asset pools held by pension funds at a time of growing distrust of government, does it make sense to establish independent inspectors general for public pensions? There certainly is precedent. On the federal level, the Pension Benefit Guaranty Corp. has an inspector general that operates within the agency but has statutory independence from management. The PBGC inspector general also handles employee and public complaints about suspected wrongdoing.

There’s no downside to having independent inspectors general for public pensions. Establishing a proactive watchdog—within a retirement system or as part of an existing state inspector general office—would have a deterrent effect. It would use data to detect vulnerabilities before fraud occurs. Inspectors general are independent representatives of taxpayers, focused exclusively on facts, and not beholden to boards, trustees, staff, retirees or politicians. They are transparent and empowered to issue unvarnished reports available to everyone.