A leading pension investigator is accusing Minnesota Governor Tim Walz, Vice President Kamala Harris’ recently announced running mate, of overseeing the manipulation of financial reports within the state’s public school teachers’ retirement system. The allegations, first reported by the New York Post, suggest that under Walz’s leadership, the Teachers Retirement Association (TRA) has been understating annual fees paid to Wall Street investment managers while exaggerating investment returns.
Edward Siedle, an independent pension investigator, claims that the TRA has only disclosed a fraction of the actual fees paid over the past decade, revealing less than 10% of the estimated $2.9 billion spent on Wall Street investment managers. He further criticizes the TRA for reporting gains that barely surpass their own benchmarks by a mere 0.2%, which Siedle describes as “virtually impossible.” In fact, he compares the TRA’s performance to a “Madoff miracle” under Walz’s watch, drawing a stark parallel to the notorious Bernie Madoff, who orchestrated the largest investment fraud in Wall Street history.
Walz, serving as chairman of the Minnesota State Retirement System since January 2019, oversees a vast portfolio of $140 billion in state employee funds, including $28.2 billion allocated to teachers’ retirement. Despite this weighty responsibility, Siedle questions Walz’s financial acumen, stating, “I don’t know if the man had any pre-existing knowledge of finance or pensions, but as chairman, he should have educated himself.”
The allegations come amidst concerns raised by teachers about the retirement system. Katie Dickerson, a teacher nearing retirement, testified in February that despite high contribution rates, there have been no improvements to the system, leading to extended work years and significant penalties for early retirement. “Not only do we have a high contribution rate to TRA, but we…are forced to work many more years unless we are willing to be hit with huge penalties,” Dickerson reportedly told the Minnesota’s Legislative Commission on Pensions and Retirement.
For the fiscal year 2023, the TRA reported an 8.9% return and $24.19 million in management fees. However, Siedle estimates the actual fees to be significantly higher, ranging from $334 million to $467 million, representing 5% to 7% of the TRA’s private assets. Even a 1% fee would amount to $280 million, exceeding the reported amount by a factor of ten. Despite requesting investment documents, Siedle has yet to receive them from the TRA or state agencies.
Further complicating the situation, Siedle points out that the Minnesota attorney general and state auditors, who typically investigate such issues, are members of the same state pension board chaired by Walz. This potential conflict of interest led Siedle to file a whistleblower complaint with the SEC and FBI in July.
The Harris-Walz campaign has not yet responded to Fox News Digital’s request for comment on the allegations.
