WHEREAS, The
Philadelphia Inquirer
on January 21, 2004, reported that in late 1999 Investment Management Advisory Group Inc. (“Image”) was paid one million dollars in the form of a finder’s fee in a $100 million bond investment package between the City and financial manager AIG, and
WHEREAS, Pension fund trustees were unaware of this payment; and
WHEREAS, No one seems to know what, if anything, Image did to earn this fee; and
WHEREAS, Two high-ranking officers of Image have been fined by securities regulators for questionable conduct; and
WHEREAS, The payment of undisclosed or concealed management, brokerage and finder’s fees poses a threat to the financial health of pension funds generally; and
WHEREAS, The 1951 Home Rule Charter created the Board of Pensions and Retirement to enact and maintain “a comprehensive, fair and actuarially sound pension and retirement system”; and
WHEREAS, 32,381 active municipal employees and 32,136 current retirees depend on the sound management and financial health of the City of Philadelphia pension fund for their survival after retirement; and
WHEREAS, For many of these people, their pension income will be their sole or major source of income after retirement; and
RESOLVED, BY THE COUNCIL OF THE CITY OF PHILADELPHIA, That it hereby authorizes City Council’s Committee on Law and Government to hold public hearings to investigate the payment by the Pension Board of management, brokerage, finder’s, and other fees, in furtherance of such investigation and toward a remedy authorizing the issuance of subpoenas or other process as the chairperson deems necessary or appropriate to compel the attendance of witnesses and the production of documents to the full extent authorized under Section 2-401 of the Home Rule Charter.
End