San Francisco supervisors on Tuesday declined to approve the reappointment of the city's former first lady to the city's retirement board, citing concerns about her personal investments. The supervisors delayed their final vote until after the New Year to give themselves time to review whether Wendy Paskin-Jordan violated ethics rules in connection with her investment in a firm that also manages city pension money.
On Saturday, the International Business Times first reported that Paskin-Jordan, a current member of the board overseeing the $20 billion San Francisco Employees Retirement System, invested between $100,000 and $1 million in a fund managed by a mutual fund firm called GMO. She was permitted to invest that amount in GMO despite the firm saying its minimum investment is $10 million. San Francisco ethics rules say no officer of SFERS may "accept a business opportunity ... a favor or anything of value from" from a firm contracted to manage SFERS money. GMO currently manages nearly $400 million of SFERS money.
In a letter to the San Francisco Ethics Commission, SFERS executive director Jay Huish said GMO allowing Paskin-Jordan to invest at a level below its normal minimum does not violate the city's rules because Paskin-Jordan was given that right in the mid-2000s, before she became a SFERS board member. However, supervisors questioned whether the favor was granted back then, or when Paskin-Jordan ultimately made her below-minimum investment in GMO in 2011, while she was on the SFERS board and subject to the city’s ethics rules.
Paskin-Jordan did not attend Tuesday's Board of Supervisors hearing about her reappointment. Supervisors said they want to hear from her directly before deciding whether to reject her reappointment to the board by Mayor Ed Lee. The special meeting about her reappointment is set for January 7.