“Last fall, I wrote about a small faction within the Retired Public Employees Association (RPEA) of California that was raising $350,000 for what it called a ‘forensic audit’ of CalPERS. The report was commissioned from Ted Siedle, a former SEC attorney known for his long-running criticism of public pension funds.
“At the time, I argued that the effort wasn’t really about transparency. It was about ideology. The group’s primary objection is to private equity as an investment strategy.
“Siedle’s report has now been published, and while it is exactly what anyone familiar with his work would have anticipated, it’s important to review and fact check a few of his claims …” – California Business Roundtable President Rob Lapsley
Don’t Be Fooled by CalPERS’ Latest ‘Watchdog’ Report
By Rob Lapsley
The California Brief
June 24, 2026
Last fall, I wrote about a small faction within the Retired Public Employees Association (RPEA) of California that was raising $350,000 for what it called a ‘forensic audit’ of CalPERS. The report was commissioned from Ted Siedle, a former SEC attorney known for his long-running criticism of public pension funds.
At the time, I argued that the effort wasn’t really about transparency. It was about ideology. The group’s primary objection is to private equity as an investment strategy.
Siedle’s report has now been published, and while it is exactly what anyone familiar with his work would have anticipated, it’s important to review and fact check a few of his claims:
Transparency: In the reports Executive Summary, Siedle claims that CalPERS provided only limited information and refused to turn over other documents, leading him to conclude that a formal Inspector General investigation is necessary. CalPERS has disputed this, stating that they provided him with a link to more than 20,000 pages of documents. When he reportedly had trouble accessing them online CalPERS then provided him with a DVD of the documents. Yet Siedle still chose to publish his report without reviewing them.
It is hard to avoid the conclusion that Siedle had no interest in actually reviewing these documents. An investigator cannot claim lack of transparency while choosing not to review the information that was provided. Publishing conclusions before examining the available evidence raises legitimate questions about the credibility of the investigation itself.
Performance: Siedle further claims that a staggering $241 billion is lost over 20 years by CalPERS investing in private equity instead of a passive public-equity alternative. Given that CalPERS currently manages $600-$630 billion in assets, this is a staggering number, obviously designed to generate alarm and headlines.
Notably, Siedle never specifies which 20 years it uses for this comparison. In investing, start and end dates matter enormously. Depending on the years selected, long-term investment comparisons can change by tens of billions of dollars, or more. This approach is not rooted in sound, financial analysis. Rather, it is a method for producing a predetermined result.
Siedle has used this approach before. In a 2023 Forbes column about Ohio’s teachers’ pension fund, he claimed alternative investments cost the fund $90 billion. Critics noted that the calculation depended heavily on selecting a time period that excluded years when the fund outperformed his chosen benchmark. Even Ohio’s State Auditor emphasized the importance of evaluating investment performance across multiple time periods rather than relying in a single snapshot.
A Familiar Template: This is also not Siedle’s first recycling job. Passages in the CalPERS report closely resemble language in the 2021 report on the Ohio State Teachers Retirement System. The same pattern was also flagged by North Carolina’s State Treasurer in 2014. It is clear that Siedle has a templated document, adapts it for a new client, and presents it as an original investigation.
There is more to the Ohio story than recycled text. After publishing his report in 2021, the Ohio Auditor of State found no evidence of fraud, illegal acts, or data manipulation. Since then, the organization that hired Siedle has become a defendant in a corruption and bribery lawsuit filed by Ohio Attorney General Dave Yost. Ironically, the people who hired Siedle are facing more serious legal scrutiny than anyone in the fund they targeted.
The Actual Record: The actual record at CalPERS tells a different story than the one being told by Siedle and the RPEA.
Private equity has been CalPERS top-performing asset class over the past 20 years, generating roughly 12% annualized returns. More recently, the Wall Street Journal noted:
the fund’s private-equity portfolio returned approximately 22% during the most recent fiscal year, while its current private-equity strategy has delivered annual returns of about 21% over the last three years. Without this return, there is more pressure to raise taxes and make California even more unaffordable.
“The change helped turn around CalPERS’s private-equity program, which returned about 22% during the year ended March 31, according to a presentation prepared for the system’s meeting next week. The current private-equity strategy has tallied returns of 21% a year in the three full years it has been in effect on a time-weighted basis.”
These are not the statistics of a fund that has lost $241 billion.
As I stated last fall, the California Business Roundtable strongly supports government transparency. We also have an obligation to call out efforts that use the language of transparency to pursue something else entirely. The RPEA represents less than 1% of CalPERS members, and its opposition to private equity is well known. That viewpoint certainly does not justify their attempts to undermine confidence in a fund that serves 2.3 million Californians and has increased in value by roughly 67% since 2016. The State Legislature has made clear that the current oversight requirements are sufficient. Siedle’s report, built on selective data and a recycled template, does not change that.
Read the full article here.
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