SEC Charges Former Municipal Officer with Fraud in Connection with Public Pension Funds
Litigation Release No. 24424 / March 15, 2019
Securities and Exchange Commission v. Dale M. Walker, No. 5:19-cv-00097-TES (M.D. GA, filed March 15, 2019)
The Securities and Exchange Commission today charged Dale M. Walker, the former County Manager of Macon-Bibb County, Georgia, with misleading three Macon-Bibb County public pension fund boards in connection with their selection of an investment adviser to manage over $400 million of pension fund assets.
The SEC's complaint alleges that Walker improperly provided an unfair competitive advantage to one investment adviser due to his romantic interest in an individual associated with the adviser. According to the complaint, Walker provided the confidential proposals of other investment adviser candidates to the adviser and asked the associated individual to analyze and rank the candidates. The completed analysis ranked the adviser first above all other applicants. The complaint further alleges that Walker attached the analysis to his memo recommending the adviser to the three pension fund boards, falsely representing that he prepared the analysis. Neither the adviser nor Walker disclosed the conflict of interest inherent in the adviser's preparation of those materials. The complaint alleges that each of the pension fund boards followed Walker's recommendation and selected the adviser as the investment adviser for their respective pension funds.
Without admitting or denying the allegations in the complaint, Walker consented to the entry of a final judgment permanently enjoining him from violating the antifraud provision of Section 206(2) of the Investment Advisers Act of 1940 and ordering him to pay a $10,000 civil penalty. The final judgment further enjoins Walker from participating on behalf of a government entity in the decision to select or retain an investment adviser or broker-dealer, any involvement with managing any public pensions or making investment recommendations to such entities, and from participating in the selection of underwriters or municipal advisers for any offering of municipal securities.
The SEC's investigation was conducted by Michael J. Adler, and supervised by Peter J. Diskin in the Public Finance Abuse Unit and the Atlanta Regional Office.