A nine-month forensic investigation commissioned by state retirees said CalPERS suffers from performative transparency, conflicts of interest, hidden excessive costs and chronic underperformance.
The 255-page report said the $630 billion fund is too intertwined with private-equity managers, pays billions in hard-to-track or undisclosed fees, and has board oversight it described as inexperienced.
Bottom-15% rankings over both five- and 10-year periods were cited as evidence of weak results, while the report also flagged staff compensation with dozens earning more than $500,000 annually.
Edward Siedle said he sent the findings to the SEC and California attorney general and urged creation of an inspector general with subpoena power to review the fund.
CalPERS CEO Marcie Frost rejected the report as baseless and said performance has improved, but the retirees' group backing the probe said stronger independent oversight is needed.
CalPERS claims top returns while a report shows the opposite. How can members know if their retirement is truly secure?
With billions in 'zombie funds,' is CalPERS' high-risk strategy a smart investment or a future taxpayer bailout?
CalPERS Under Fire: Independent Probe Reveals Mismanagement, Secrecy, and Calls for Reform in $500 Billion Pension Fund
Overview
An independent investigation launched in late 2025 uncovered serious mismanagement and a culture of secrecy within CalPERS’ investment division. The probe revealed poor decision-making and oversight, with major investment losses and confidential severance payments, while also highlighting deliberate efforts to withhold information from the public and board members. These findings have sparked anxiety among stakeholders about the security of retirement benefits and the fund’s long-term sustainability. In response, CalPERS leadership has pledged reforms and greater transparency, but the situation has triggered widespread calls for legislative scrutiny and systemic changes to restore public trust and ensure accountability.