Kevyn Orr just dropped another shoe, in effect. as a team of Detroit News writers report:
Emergency Manager Kevyn Orr launched a probe of the city’s pension funds Thursday amid concerns about corruption, spending and management.
The probe . . . could lead to Orr freezing pensions and ousting trustees who oversee the city’s two beleaguered retirement funds, which are underfunded and embroiled in a federal criminal probe and complaints about failed investments and lavish travel.
Kevyn Orr asked Detroit's auditor and inspector general to examine "possible waste, abuse, fraud, and corruption" in employee benefit programs.
The city's auditor and inspector general are directed to look into "possible waste, abuse, fraud, and corruption" associated with the city's employee benefit programs, Orr spokesman Bill Nowling tells The News.
"In our investigation and review of the numbers, we've uncovered some troubling patterns that we think need further investigation.”
Nowling cited the recent hiring by one fund of a lawyer mentioned in a federal criminal indictment and questionable spending by officials, including a trustees' trips to a Hawaii conference in May.
The aide also signaled a possible takeover by the emergency manager:
"If they're not being managed properly, then we need to find a way to manage them properly."
That step wouldn't surprise Matt Gnatek, chairman of the Police and Fire Retirement System, who tells The News: "It's obvious they want to take over the system,"
The paper notes that city pension funds have lost more than $84 million on corrupt investments given to companies during Kilpatrick's tenure, according to the U.S. attorney's office.
