- Associated Press - Friday, June 5, 2015

BATON ROUGE, La. (AP) - The director the Municipal Employees Retirement System of Louisiana has been put on paid leave after the disclosure that law enforcement officers are investigating possible document tampering.

NOLA.com/The Times-Picayune reported (https://bit.ly/1IqC94Z ) that the system’s board was told Friday that director Robert Rust spent three weeks removing from his office a number of receipts that are part of a Louisiana Legislative Auditor investigation into spending.

Charges on a system credit card that Rust controlled include questionable expenditures the past several years, including out-of-state trips and thousands of dollars spent over two dinners at Ruth’s Chris Steak House in Baton Rouge.

The 8,000-member municipal system is one of three statewide organizations that oversee the retirement funds of public employees.

Board members first took action on the spending allegations at a May 21 meeting after reviewing 20 allegations of improper spending, initially reported as part of an investigation by WVUE-TV. But board members did not discuss putting Rust on leave during that meeting; they moved swiftly to do so after the board’s general counsel, Warren Ponder, told members he discovered a hotel receipt the system had on file may have been altered to conceal the fact that the room had been in the name of both Rust and his son.

Ponder said he contacted the East Baton Rouge Parish Sheriffs’ office upon discovery of the discrepancy and was told they would investigate. Staff members told the board that Rust had been taking home receipts for spending over the past three weeks - dating to when the WVUE-TV investigation first aired - and that raised alarms for board members about whether Rust could have been altering additional documents.

Rust could not immediately be reached for comment Friday. A call by the newspaper to his attorney, John Aydell Jr., was not immediately returned.

The revelations Friday are a significant turn for the investigation because there is now the possibility that criminal allegations could be introduced, board members acknowledged. There are also indications that the investigation could broaden in scope because staff members have said there were problems with documenting receipts on the system’s credit card for years, and that staff members had alerted the system’s independent auditors about the problem in the past.

“These allegations are serious, we’ve got new allegations that documents were taken out of this place and some documents were altered,” state Treasurer John Kennedy said Friday. “We’ve got an $80 million deficit in this system. It’s not like we’re rolling in bucks here.”



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