{"id":87180,"date":"2024-01-26T01:44:16","date_gmt":"2024-01-26T06:44:16","guid":{"rendered":"https:\/\/www.hedgeco.net\/news\/?p=87180"},"modified":"2024-01-26T01:44:16","modified_gmt":"2024-01-26T06:44:16","slug":"chicago-based-aon-investments-charged-with-misleading-pennsylvania-public-employees-pension-fund","status":"publish","type":"post","link":"https:\/\/hedgeco.net\/news\/01\/2024\/chicago-based-aon-investments-charged-with-misleading-pennsylvania-public-employees-pension-fund.html","title":{"rendered":"Chicago-based Aon Investments Charged with Misleading Pennsylvania Public Employees\u2019 Pension Fund"},"content":{"rendered":"\n

(HedgeCo.Net) The Securities and Exchange Commission has settled charges against Aon Investments USA Inc.<\/strong>, a Chicago-based registered investment adviser, and the firm\u2019s former partner, Claire P. Shaughnessy, for misleading their client, the Pennsylvania Public School Employees\u2019 Retirement System (PSERS), about the reason for a discrepancy between two different calculations by Aon of PSERS\u2019s investment returns for the same period.<\/p>\n\n\n\n

The SEC\u2019s orders find that Aon was responsible for calculating PSERS\u2019s investment returns for \u201crisk share,\u201d a provision under Pennsylvania law that requires public school employees to contribute more to their pensions if the retirement fund does not meet certain investment return rates. If PSERS\u2019s investment return rate for the nine-year period ending June 30, 2020 was lower than 6.36 percent, it would trigger risk share, requiring an increase in public-school employees\u2019 contributions.<\/p>\n\n\n\n

According to the SEC\u2019s orders, in June 2020, Aon provided PSERS its quarterly returns for the purpose of estimating PSERS\u2019s investment return rate. The orders find that some of the quarterly returns Aon provided to PSERS in 2020 did not match the historical returns that Aon previously provided PSERS for the same periods.<\/em><\/strong> According to the SEC\u2019s orders, PSERS repeatedly questioned Aon\u2019s calculations of the investment returns and asked Aon to investigate a discrepancy between the returns. The SEC finds that, in response to these inquiries, Aon and Shaughnessy, who led the PSERS engagement, failed to adequately investigate that discrepancy, instead providing PSERS with two reasons for the discrepancy that Aon had previously ruled out. The orders further find that Shaughnessy misrepresented to PSERS that the discrepancy was not due to errors when, in fact, she did not know the reason for the discrepancy. According to the orders, in December 2020, Aon and Shaughnessy reported to PSERS that the risk share return rate for that period was 6.38 percent \u2013 just high enough to avoid triggering risk share. Ultimately, the discrepancy turned out to be due to errors in the underlying data, and, when the rate was recalculated, the corrected return rate was 6.34 percent \u2013 triggering risk share and requiring additional employee contributions.<\/p>\n\n\n\n

\u201cInvestment advisers must be scrupulously honest with their clients,\u201d said LeeAnn G. Gaunt, Chief of the Public Finance Abuse Unit. \u201cPension funds and other municipal entities should be able to trust that their investment advisers are telling them the truth.\u201d<\/em><\/strong><\/p>\n\n\n\n

Without admitting or denying the SEC\u2019s findings, Aon consented to a settled order finding that it violated Section 206(2) of the Advisers Act, censuring it, and ordering it to pay a civil penalty of $1 million<\/strong> and disgorgement and prejudgment interest of $542,187.<\/strong> Without admitting or denying the SEC\u2019s findings, Shaughnessy consented to a settled order finding that she also violated Section 206(2) of the Advisers Act, censuring her, and ordering her to pay a civil penalty of $30,000.<\/p>\n","protected":false},"excerpt":{"rendered":"

(HedgeCo.Net) The Securities and Exchange Commission has settled charges against Aon Investments USA Inc., a Chicago-based registered investment adviser, and the firm\u2019s former partner, Claire P. Shaughnessy, for misleading their client, the Pennsylvania Public School Employees\u2019 Retirement System (PSERS), about […]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16,3,16048],"tags":[],"class_list":["post-87180","post","type-post","status-publish","format-standard","hentry","category-hedgeco-networks-press-releases","category-hedgeco-news","category-hedgecovest-news"],"_links":{"self":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/87180","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/comments?post=87180"}],"version-history":[{"count":1,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/87180\/revisions"}],"predecessor-version":[{"id":87181,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/87180\/revisions\/87181"}],"wp:attachment":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/media?parent=87180"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/categories?post=87180"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/tags?post=87180"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}