Former California police chief charged in CalPERS double-dipping fraud case

Mike Koozmin/San Francisco Examiner

Criminal charges of grand theft have been brought against Greg Love, one of several Broadmoor Police Department chiefs and commanders that CalPERS said defrauded the pension system by collecting more than $2 million in excessive retirement payments.

Another former chief, however, David Parenti, won’t be subject to any criminal prosecution.

This despite CalPERS’ contention that he committed one of the largest frauds in its history. The pension plan said Parenti illegally received pension benefits of $1.8 million while with the 11-member department located 2 miles outside of San Francisco.

The reason for a lack of criminal action?

CalPERS misplaced the records for more than four years that detailed a complaint by a police officer at Broadmoor that his boss, Parenti, was double-dipping, collecting retirement benefits while drawing a salary as police chief and other positions, said San Mateo County Prosecutor Steve Wagstaffe.

Wagstaffe said the four years is the statute of limitations for state criminal cases and CalPERS informed him of fraud violations in Parenti’s case only in 2021 after an audit of Broadmoor. That was more than four years after it received the original complaint about Parenti’s fraudulent behavior, Wagstaffe said.

“How they missed it is beyond me,” he said. “Purely on their failure to follow up on things is why Mr. Parenti is able to go free.”

When The Bee reached out CalPERS officials, they did not address the missing complaint against Parenti. Instead, they disputed that the district attorney could have not proceeded criminally against him.

“While charging decisions are the DA’s prerogative, we don’t necessarily agree that the statute of limitations has run in this case or that there aren’t other ways of pursuing this matter criminally,” CalPERS Chief Counsel Matt Jacobs said in a statement.

Jacobs didn’t go into specifics.

Parenti’s civil attorney, Scott Kivel, said his client’s position is that he did not receive illegal retirement payments. CalPERS is seeking the return of the $1.8 it said that Parenti obtained fraudulently.

Love, who was charged on November 15 by the San Mateo County District Attorney’s Office, collected around $700,000 in pension benefits after retiring from the police chief’s position in 2009 through 2012, Wagstaffe said.

Love is scheduled to be arranged on December 9. His attorney Jeffrey Hayden did not respond to requests for comment.

Love’s May 2009 retirement only lasted two days, even after receiving an unspecified workers compensation disability payout, which stipulated that he could no longer work as police chief, a CalPERS audit in 2021 showed.

Love continued to be the full-time salaried police chief for Broadmoor through 2012 while continuing to collect the retirement benefits at the same time, the CalPERS audit determined.

Wagstaffe said Love faces up to four years in prison.

Equal justice?

The District Attorney said he and his staff have had discussions about the different outcomes for Parenti and Love and whether that is fair.

“Parenti is going to go free and Love is held accountable,” he said. “But in the end everyone gets evaluated individually. We have a job to do. We can’t try to even the playing field.”

Wagstaffe, a long-time employee of the San Mateo County District Attorney’s Office, said he has had frequent dealings with Love in their roles as law enforcement officers over the years.

“He is not a bad person,” Wagstaffe said. “It was a bad act that violated the law. He violated CalPERS rules and has to be held accountable.”

The DA said he did ask the U. S. Attorney’s Office in San Francisco to consider taking the criminal case against Parenti, because federal statute of limitations is six years, two years longer than the state rules, but officials refused without disclosing why.

The Broadmoor police department audit by CalPERS in 2021 and subsequent CalPERS findings found that Parenti and Love committed most of the department’s alleged fraudulent retirement benefits, totaling $2.3 million.

While Love was found by CalPERS to have collected retirement benefits and salary for three years from 2009 to 2012, Parenti was accused of defrauding the pension system for 12 years from 2007 to 2019.

CalPERS contends the fraud included Parenti receiving workers compensation disability settlement from the Broadmoor Police Department of $108,500 on August 4, 2017.

While the settlement should have ended Parenti’s career, he continued working as a commander for the department full-time for two more years. This occurred, the CalPERS 2021 audit said, while Parenti continued to receive retirement benefits.

How did CalPERS err?

What remains a mystery is how CalPERS missed the original complaint against double-dipping at Broadmoor.

The former Broadmoor police officer who told CalPERS of Parenti’s double-dipping, Steve Landi, said in a Bee interview in February that he had reported the fraud to the pension system in November 2016.

“They were lining their pockets for years,” Landi said. “It’s corruption at its finest.”

CalPERS had insisted to The Bee that it never received Landi’s complaint.

Wagstaffe said CalPERS officials first denied to him that there was a previous complaint, insisting they learned of the Broadmoor fraud first during the 2021 audit.

“CalPERS originally told us (in 2021) we knew nothing about this until a little while ago,” Wagstaffe said, referring to CalPERS audit findings that year.

He said after his agency insisted CalPERS conduct a review: “They found the complaint from Landi in their records.”

Wagstaffe said there was break-down at CalPERS that it missed the complaint of fraud for more than four years.

“Ultimately, we pressed them and pressed them and pressed them and they looked at the records, and said oh yeah it (the double-dipping fraud) was reported to us by one of the other officers in Broadmoor.”

Wagstaffe’s statements raise new questions about the effectiveness of CalPERS to root out double-dipping and other violations of pension system rules.

An earlier concern

Broadmoor was under scrutiny by CalPERS for failing to enroll some officers in the pension fund in 2017, CalPERS has previously disclosed, but not for the double dipping by top police personnel.

Former CalPERs insider J.J. Jelinicic told the Bee in February that the CalPERS division that monitors employee enrollment issues has little coordination with another unit assigned to examine double-dipping and other state retirement rule violations.

“The right hand doesn’t know what the left is doing,” said Jelincic, a former CalPERS investment staffer and board member.

Even routine audits of CalPERS employer units, like the one that discovered problems at Broadmoor, are rare given the large size of the pension system, which covers more than 2 million active and retired members and has more than $430 billion in assets.

Around 240 audits are done a year but there are around 3,000 separate employer units representing municipalities, special districts and school systems that are part of CalPERS. On that schedule, it would take 12 years for every CalPERS agency to be reviewed. The pension system also represents state employees.

Broadmoor is one of the smallest of the 3,000 CalPERS employers.

In fact, the Broadmoor Police Protection Department is an anomaly in the state of California. There is no town or city of Broadmoor. The police department covers an unincorporated part of San Mateo County of several square miles and is surrounded by Daly City on three sides and Colma on one side. It serves around 8,000 residents.

While he is facing no criminal penalties, CalPERS continues to demand that Parenti return the $1.8 million in retirement benefits he received between 2007 and 2020 while working as a police chief and in other positions at Broadmoor.

“We are continuing to aggressively address Mr. Parenti’s actions on the civil front,” said CalPERS Chief Counsel Jacobs in his statement. “We strongly believe he wrongly received some $1.8 million in retirement benefits and will continue to pursue repayments of those funds.”

CalPERS stopped Parenti’s benefits of around $13,000 a month in April but in July they were restored by a San Francisco Superior Court judge in an on-going battle over the retirement money.

Wagstaffe said Love and CalPERS have already reached a negotiated settlement on Love paying back retirement benefits. He said he did know details of the agreement.

Love had been collecting more than $13,000 a month in retirement benefits.