Calpers said it was probing the fees outside money managers had been paying to win business with the largest U.S. pension fund, adding a new dimension to a wider review of so-called pay-to-play schemes.

The $200-billion California Public Employees' Retirement System said the probe centers around payments of more than $50 million that outside managers made over a five-year period to ARVCO Financial Ventures LLC, a firm headed by former Calpers board member Al Villalobos.

Similar reviews are under way in other states, including New York.

Fund executives have notified federal securities regulators at the Securities and Exchange Commission and the California attorney general's office.

The placement agent industry has been a focus of state authorities and the Securities and Exchange Commission over the last year, and we believe it prudent to conduct a full review of the matters related to these recent disclosures to us, Calpers Chief Executive Anne Stausboll said in a statement.

(Reporting by Svea Herbst-Bayliss; Editing by Tim Dobbyn)