Four TSP Board Nominees Confirmed: Nominee for Controversial FRTIB Chair Not Approved

Four nominees have been confirmed for the FRTIB, the TSP’s governing board. Confirmation moved quickly after Senator Marco Rubio removed a hold on the nominations.

The Senate has confirmed four nominees to the Federal Retirement Thrift Investment Board (FRTIB). The FRTIB administers the Thrift Savings Plan (TSP) for federal employees and members of the uniformed services. There are now about 6.6 million investors in the TSP which has assets of almost $740 billion.

Senator Marco Rubio’s Hold on Nominations

The nominations were placed on hold by Senator Marco Rubio (R-FL) on all four nominations pending confirmation of their commitment not to invest money in Chinese companies working to undermine American interests and national security.

Senator Rubio removed his hold on the nominations on June 2nd. In responding to the letter from three Senators seeking their commitment to “ensuring that the TSP’s I Fund does not mirror the MSCI All Country World ex-U.S. Investable Market Index”, the nominees wrote, in part:

“[W]e would not allow TSP funds to invest in equities based in jurisdictions that do not offer the protections of the PCAOB” (Public Company Accounting Oversight Board). As China is the only country where the PCOAB is unwelcome, “we would not permit TSP funds to invest in Chinese companies knowing TSP participant and beneficiary assets could be subject to fraud, financial irregularities or other risks.”

Nominees Confirmed to the FRTIB

Leona M. Bridges, a commissioner for the San Francisco City & County Employees’ Retirement System, was confirmed to a term expiring in October 2023. This position is now held by William S. Jasien.

Stacie Olivares, a trustee of the San Francisco Public Employees’ Retirement System, was confirmed to a term expiring in September 2024, replacing Ronald McCray.

Dana K. Bilyeu, executive director of the National Association of State Retirement Administrators, was confirmed to a third term, expiring in October 2023.

Michael F. Gerber, senior managing director, and chief corporate affairs officer at FS Investments, and a co-founder and adviser at Intrinsic Capital Partners, was confirmed to fill a term will fill the seat vacated by former Chairman Michael Kennedy, who resigned in 2020 after a dispute involving the TSP investing in some Chinese companies through the TSP’s I Fund.

While serving as Chairman of the FRTIB, Kennedy released an editorial on the situation in which he defended the decision to invest in these Chinese companies. He responded to critics, and it was likely Rubio was the primary intended audience of the article.

Kennedy said that the FRTIB was doing its fiduciary duty to the federal workforce by making the change, federal employees stand to get better returns from the alternate index, and the change puts the TSP more in line with what other large companies and government contractors are doing.

Nomination for Javier Saade Not Approved Based on Extreme Comments

There is one FRTIB nominee whose nomination is still pending. Javier E. Saade has been nominated as the board’s chairman and would replace David A. Jones, who is acting chairman. His nomination is controversial as he has been quoted as making extreme comments about Republicans and the American economic system.

These comments were brought up in his hearing and the negative tone of the comments led to Republicans voting against him although he still received support from Democrats on the committee.

The Senate Homeland Security and Governmental Affairs Committee split on Saade’s nomination in a 7-7 vote. Saade has been criticized for comments he made comparing Republicans to facists and calling for a “reboot of capitalism”. Not surprisingly, Republicans on this committee concluded his comments made him an inappropriate nominee for the position.

As Saade’s nomination did not receive sufficient support in the committee, it cannot go to the full Senate without Majority Leader Chuck Schumer (D-NY) discharging it from the committee.

About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters on federal human resources. Follow Ralph on Twitter: @RalphSmith47