HARRISBURG — Leaders of several public pension systems in Pennsylvania continued to work with an investment adviser, his company, or a company for which he consults after he settled allegations of violating antifraud laws, a Spotlight PA investigation has found. That includes three counties [Somerset, Tioga and Wyoming] and at least two municipal systems [Economy Borough and Monongahela City] that received payments from the adviser as result of the federal settlement.

The SEC case and the lack of transparency from local government agencies afterward highlights how these systems make crucial decisions about people’s finances and retirement funds, but often face little public scrutiny.

The U.S. Securities and Exchange Commission alleged William Vescio [sole owner of Vescio Asset Management or VAM Group] caused clients to invest in a class of mutual fund shares with higher fees, most of which he received, instead of a lower-cost option. For some clients, federal authorities alleged William Vescio negligently failed to disclose information and those “inaccurate disclosures gave the misleading impression that the overall fees were lower than they actually were.”

The Allegheny County adviser settled with the agency in 2020, agreeing to be censured and pay $275,000 in disgorgement, $40,000 in civil penalties, and interest. In the settlement, he did not admit or deny the commission’s findings. A new release from the agency said he “agreed to distribute the funds to harmed investors.” He made final payments as recently as June of this year, records obtained by Spotlight PA show.