CalPERS Moves to Implement Lower Pension of Former Vernon Official
March 6, 2014
External Affairs Branch
Robert Udall Glazier, Deputy Executive Officer
Brad Pacheco, Chief, Office of Public Affairs
Contact: Amy Morgan, Information Officer
SACRAMENTO, CA - The California Public Employees' Retirement System (CalPERS) announced today that it is lowering the pension of convicted felon and former City of Vernon official Bruce Malkenhorst, following a court ruling last week that supports the pension fund's belief that it must recover money owed to the system.
CalPERS will reduce Malkenhorst's monthly retirement benefit amount of $45,974.02 to $9,654 in his next payment scheduled for April 1, 2014.
"We intend to recover every penny that he owes CalPERS," said Anne Stausboll, Chief Executive Officer for CalPERS. "Given the extraordinary amounts involved in this case, and the rate at which the potential overpayment has grown and will continue to grow, and recent developments in the law, we have concluded we can no longer continue to pay the higher amount."
On Friday, February 28, the First Appellate District Court in California issued a ruling in the City of Oakland versus the Oakland Police and Fire Pension System indicating that retirement systems must correct overpayments sooner than later.
CalPERS had concluded in a 2012 audit that the pension Malkenhorst has received since his retirement in 2005 was based on unpublished pay rates, overtime and an inflated longevity allowance.
Malkenhorst pleaded guilty in 2011 to misappropriating public funds and using the funds for his own personal expenses.
CalPERS is the largest public pension fund in the U.S., with more than $283 billion in assets. CalPERS administers health and retirement benefits on behalf of 3,089 public school, local agency and state employers. Members number more than 1.7 million in the CalPERS retirement system and more than 1.3 million in its health plans. Additionally, CalPERS administers its LTC Program for nearly 145,000 participants, backed by the more than $3.7 billion in assets of its Long-Term Care Fund. For more information about CalPERS visit www.calpers.ca.gov.