Despite State Treasurer Curtis Loftis backing away from his threat to refuse payment for an investment, the state Retirement Investment Commission is proceeding with its case against him today.
In a petition filed with the Supreme Court for today, the commission stated:
“While the Treasurer has agreed to fund the obligation, the case is by no means moot in its entirety. The underlying confusion between the Treasurer’s role, as fund custodian and RSIC as the properly designated agency to make investment decisions for the Trust, remain. Although the Treasurer has, at the eleventh hour, finally relented and agreed to properly fund the obligation based upon information which has been in his possession for many months, the prospect of this unlawful conduct remains without clarification and determination from this Court that the Treasurer must fund lawful investment decisions as custodian, unless able to come forward with evidence that the approved investment is palpably illegal.”
State Treasurer Curtis Loftis filed his response with the South Carolina Supreme Court Monday, saying he has authorized investment funding with the firm Warburg Pincus. The Treasurer said he based his decision after reviewing the lawsuit against him, for now ending a standoff that had lasted for several months.
Loftis and his attorneys say the information contained in sworn affidavits by senior officials of the South Carolina Retirement System Investment Commission (SRSIC) were what he was asking for when he refused to authorize payment to Warburg Pincus. He says he asked for a legally binding statement “that the terms, fees and conditions in the final investment agreement are the same as approved by the Investment Commission.”
Specifically, he requested a document of “legal sufficiency” signed by the commission’s staff attorney stating that South Carolina would not pay more for the contract in the future. He maintained that emails from the commission were not a sufficient document and may be subject to change in the course of contract negotiations.
“Standardized forms, policies and procedures are common banking practice across South Carolina and the public’s treasury should be no different,” Loftis says.
But the commission’s top executive insists the document Loftis wanted does not exist. SCRSIC officials sued Loftis over his unwillingness to authorize the payment (Read complaint). The commission’s Chief Operating Officer Darry Oliver says the $11.7 million payment were a part of Loftis’ ministerial duties, nothing more. “That means he needs to write the check for a properly approved investment,” he told South Carolina Radio Network.
He says the Treasurer does not have the power to “veto” payments that have already been approved. “It seems, if you read the law, that some would say it’s an abuse of power.” Commission officials have not yet responded to Loftis’s Monday decision.
Loftis says he is responsible for the investment, cash management, and safekeeping of the State’s general and restricted funds and the assets of the South Carolina Retirement Systems. He was willing to make that case to the Supreme Court.
The Supreme Court hears the case Tuesday at 8:30 a.m.