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UPDATE: Ousted from 22-year Pa. pension post, Maiale speaks

On McCord, Clark, Corbett, Rendell, and 'soured' hedge funds

UPDATE: Nicholas Maiale, who has resigned after 22 years as chairman of the $25 billion Pennsylvania State Employees' Retirement System, speaks up about the Anthony Clark investigation, State Treasurer Rob McCord's demand that Gov. Tom Corbett replace Maiale, how manager selection worked when Ed Rendell was Governor, and why, after investing billions, Maiale 'soured on hedge funds', in my column here in today's Philadelphia Inquirer here. (If you're not a subscriber by now, you can read the story this week by typing in code F47S). #inq

Nicholas Maiale, the South Philly lawyer and ex-state representative who has chaired the $25 billion Pennsylvania State Employees' Retirement System since 1992, is giving up the post, acording to a letter Maiale sent Gov. Corbett.

Maiale told Corbett "the SERS Board and staff has done an outstanding job" and is "secure" despite long-term "underfunding." He made no reference to the resignation of his chief investment officer, Anthony Clark, after an internal investigation into Clark's conduct was disclosed earlier this month and State Treasurer Rob McCord called on Corbett to replace Maiale for not disclosing the investigation earlier.

SERS has not announced Maiale's move and Corbett has not named a replacement. Maiale oversaw SERS' diversification from old-fashioned bond and stock investments into one of the leading U.S. buyers of high-fee venture capital, real estate, buyout, hedge and commodity funds under Govs. Casey, Ridge, Schweiker, Rendell and Corbett; as Maiale noted in his letter to Corbett, that wasn't enough to keep the fund's obligations from expanding faster than its assets in recent years.

Corbett was due to name a new SERS chairman from among the system's 11 politically-appointed trustees this month. In his letter, Maiale says he will relinquish the seat on Jan. 3 and will resign from the board on Jan. 22. In an interview earlier this month after Clark resigned, Maiale told me he wasn't sure if Corbett wanted to keep him on -- or if he himself wanted to stay. A spokesman for Corbett had no immediate comment today.

Treasurer McCord, a SERS board member who hopes to run against Corbett this fall, had called for Maiale's ouster after Clark left, complaining that Maiale should have disclosed and expanded the investigation earlier. McCord has also criticized SERS' purchase of "funds-of-funds" investment funds, which he called expensive and unrewarding.

But Maiale has noted his moves have been approved by board majorities.

Pa. state pension chairman quits