State pension official departs

Carol Boykin, chief investment officer of Maryland's troubled state employee pension system, has been ousted, sources said.

Joseph M. Coale, a spokesman for the $25 billion system, said yesterday that Boykin's employment ended April 15. He would not say whether she left voluntarily, noting the restrictions of state personnel laws. But another source in the system said her departure was not voluntary and was done "for the good of the agency."


Boykin served at a time when the system was beset by scandal and poor financial performance. She had come under public criticism from state Comptroller William Donald Schaefer, the pension board chairman, over her handling of the system's relationship with Baltimore investment banker Nathan A. Chapman Jr.

Chapman supervised a pension fund manager who invested state pension money in companies Chapman controlled. Those transactions are being investigated by federal regulators and prosecutors.


Boykin, who came to the system in 1999, declined to answer questions yesterday except to confirm that she left her $116,171-a-year job as the system's top investment strategist April 15.

That is the day the pension board met behind closed doors to make decisions about the people who will lead the system as it tries to rebuild the confidence of its 275,000 members. At the same meeting, the trustees hired Thomas K. Lee, the state's deputy budget secretary, as the system's executive director.

Boykin's departure is the third by a top official of the state pension system since trustees learned in January of last year that Chapman, a politically well-connected businessman, had allowed a money manager he hired to invest pension money in companies Chapman controlled. The board fired Chapman that month.

State Treasurer Richard N. Dixon, then-chairman of the pension board, resigned within weeks, noting failing health.

Next to go was the pension system's executive director, Peter Vaughn. He retired in December on a medical disability at 46 after he, too, was criticized by Schaefer.

Boykin, 44, was criticized by trustees on at least two occasions for failing to provide them with information.

When Alan B. Bond, the money manager who invested in Chapman stock, was indicted in December 1999 on federal charges of defrauding other pension systems, Boykin was assigned by Dixon to talk with Chapman.

She conveyed to Dixon Chapman's reassurances that the charges were "trumped up," and the matter was dropped. Neither she nor Dixon informed the full board of Bond's indictment. Bond went on to defraud the Maryland system of millions of dollars.


When The Sun reported in November that trustees failed to let Bond go after the indictment, several expressed dismay that Boykin had not informed them about the matter.

Boykin later told the General Assembly's Joint Pension Committee that it was not in the system's "purview" to press Chapman to fire Bond. That statement -- and others made that day -- dismayed legislators and brought a public rebuke from Schaefer.

"There's a duty to tell the chairman and report to the board," Schaefer said at the time. "If [Boykin] sees something wrong, it's her duty as the investment adviser to tell the board and not just stand on 'it's not my purview.'"

Boykin had been criticized earlier by board members for failing to inform them that the system's 2001 investment performance had been ranked last in a national survey.