Ex-Rhode Island Treasurer Says Hedge Fund Fee Payments Have Soared

Jun 3 2013 | 10:20am ET

The controversy over the Rhode Island state pension's hedge fund policies continues to rage, with a former state treasurer—and current candidate to retake the job—criticizing his successor.

Frank Caprio, who served as the state's treasurer from 2006 until 2010, blasted current General Treasurer Gina Raimondo, claiming that fees paid by the pension to hedge funds "have gone up from about $12 million annually to about $50 million." He said that, by contrast, under his administration, Rhode Island paid "some of the lowest fees in the country."

Raimondo last month released a breakdown of the fees paid to Rhode Island's hedge fund managers, among them such marquee names as Och-Ziff Capital Management, D.E. Shaw Group, Viking Global Investors and Brevan Howard Asset Management. Raimondo's report said that Rhode Island paid about $15.9 million during the fiscal year ended June 30, 2012.

The Providence Journal's PolitiFact Rhode Island ruled that Caprio's claims were only "half true," noting that it is unclear whether Caprio's figures for his own stewardship are complete.

Caprio, who was the Democratic nominee for governor in 2010, losing to then-Independent Lincoln Chafee, who last week joined the Democratic Party, is seeking the party's nod for his old job in 2014 against Raimondo, also a Democrat.

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