The trustees of the Alaska Permanent Fund Corp. are seen during a quarterly meeting Feb. 16. (James Brooks/Alaska Beacon)

The trustees of the Alaska Permanent Fund Corp. are seen during a quarterly meeting Feb. 16. (James Brooks/Alaska Beacon)

Alaska Permanent Fund leaders vote to hire law firm to investigate leaker and themselves

Third-party investigator will examine six years of contacts between staff and the board of trustees.

This article has been updated with additional information.

The board in charge of Alaska’s $80 billion trust fund has voted to hire a third-party law firm to investigate who leaked internal emails that indicated board member Gabrielle Rubenstein may have engaged in self-dealing.

The law firm, whose hiring was approved in a unanimous 6-0 vote on Thursday, will also review six years’ worth of interactions between Alaska Permanent Fund Corp. staff and members of the corporation’s board of trustees to determine the scope of problems within the corporation.

The leaked internal emails, first published in April by the Alaska Landmine, indicate Rubenstein set up meetings between staff and her own business associates. In one message, Chief Investment Officer Marcus Frampton says, “I would put it out there that a reasonable person looking at the facts here might question whether she has some conflicts that are clouding the independence of her positions here.”

In an editorial written after the publication of those emails, the Anchorage Daily News said the fund should “divest” itself of Rubenstein, daughter of billionaire David Rubenstein.

Rubenstein, in prepared statements, has said she follows the fund’s ethics rules.

Jeff Landfield, owner of the Alaska Landmine and author of the article that publicized the emails, said he thinks the Permanent Fund’s approach misses the mark.

“I think they should be looking at the content of the allegations more than looking for the source of the leak,” Landfield said on Friday, after the vote.

“They’ve talked very little about her conflicts of interest and what several of the staff said, and it’s more about reacting instead of reflecting,” he said.

The Alaska Legislature, which has oversight authority, has not taken significant action. Rep. Cliff Groh, D-Anchorage, has requested a hearing of the Legislative Budget and Audit Committee on the topic.

Speaking before Thursday’s vote, Trustee Adam Crum, also commissioner of the Alaska Department of Revenue, said the Permanent Fund board has “to find a way to grow back into a high-trust environment. And right now, we’re not quite there.”

Trustee Craig Richards said hiring outside counsel to perform an investigation is the right thing to do as a fiduciary.

“As a matter of public perception, if we’re not viewed as being proactive on both the leak and some of the concerns raised in the materials that leaked, we’re going to be in a worse situation in terms of the process,” he said.

Speaking Friday, Crum said it’s important for trustees to understand how the emails were leaked because staff handle billions of dollars’ worth of financial transactions.

“We have a lot of confidential information on dealflow that can’t be leaked,” he said.

Board chair Ethan Schutt said the law firm — which one has not yet been decided — will take an “independent look at both the substance of the internal emails as well as how they possibly got out of the corporation.”

Trustee Jason Brune, formerly commissioner of the Alaska Department of Environmental Conservation and now sitting in a public seat on the board, suggested that the firm examine six years’ worth of contacts because he recalled being warned about interactions between staff and board members when he became a trustee.

“There was significant concern about threats and contact and non-communication between staff and trustees at that point. As well, obviously, this is a continuing issue,” Brune said.

Brune said after the meeting that he believes issues predated the arrival of Rubenstein or himself and that a “holistic review” will ensure that trustees address both current issues and past ones so the board’s governance committee can address them.

Since Landfield’s article, the board of trustees has been reviewing its governance — rules that block trustees and protect staff.

“This is not something we have ignored. We’ve had conversations on this, been trying to address this and are trying to find the best way in order to do this,” Crum said.

• James Brooks is a longtime Alaska reporter, having previously worked at the Anchorage Daily News, Juneau Empire, Kodiak Mirror and Fairbanks Daily News-Miner. This article originally appeared online at alaskabeacon.com. Alaska Beacon, an affiliate of States Newsroom, is an independent, nonpartisan news organization focused on connecting Alaskans to their state government.

More in News

(Juneau Empire file photo)
Aurora forecast through the week of Nov. 17

These forecasts are courtesy of the University of Alaska Fairbanks’ Geophysical Institute… Continue reading

Rep. Andi Story, a Juneau Democrat, listens to a presentation during a House Education Committee meeting May 3, 2024, at the Alaska State Capitol. Story has been named co-chair of the committee for the upcoming legislative session. (Mark Sabbatini / Juneau Empire)
State Rep. Andi Story to co-chair House Education Committee under new Democrat-led majority

Sara Hannan remains on Finance Committee as Juneau representatives look to play bigger roles

Larry Gamez and Rachel Ceja collect items for a Thanksgiving food basket to deliver to a house in the Mendenhall Valley on Saturday morning as part of St. Vincent de Paul’s annual distribution program. (Mark Sabbatini / Juneau Empire)
Matching those hungry to help with those hungry to feast carries on as pre-Thanksgiving ritual

Food baskets delivered to hundreds of homes, food bank hosts annual drive on Saturday before holiday.

(Michael Penn / Juneau Empire file photo)
Police calls for Wednesday, Nov. 20, 2024

This report contains public information from law enforcement and public safety agencies.

The U.S. Capitol Christmas Tree reaches Washington, D.C., on Wednesday, Nov. 20, to much celebration. (U.S. Capitol Christmas Tree photo)
Santa’s truck-driving helpers are east bound and down to Washington, DC

U.S. Capitol Christmas Tree completes multiweek cross-country journey from Wrangell.

The Palmer project would sit in the watershed of the Chilkat River, pictured here. (Scott McMurren/Flickr under Creative Commons license 2.0)
Japanese smelting giant pulls out of major Southeast Alaska mining project

Palmer development, above the salmon-bearing Chilkat River, has for years fueled political divisions.

Juneau Police Department cars are parked outside the downtown branch station on Thursday. (Mark Sabbatini / Juneau Empire)
JPD’s daily incident reports getting thinner and vaguer. Why and does it matter?

Average of 5.12 daily incidents in October down from 10.74 a decade ago; details also far fewer.

(Michael Penn / Juneau Empire file photo)
Police calls for Monday, Nov. 18, 2024

This report contains public information from law enforcement and public safety agencies.

Most Read