(Reuters) – California’s state treasurer sent a stern letter to the state’s teachers’ pension fund on Wednesday, asking that the fund’s managing partner, Cerberus Capital Management, fully divest from the assault weapon manufacturer, Freedom Group.
Treasurer John Chiang said he was frustrated that the manufacturer of the assault weapon used in the 2012 killing of 20 children and seven adults at Sandy Hook Elementary School in Connecticut was still indirectly financed by the California State Teachers’ Retirement System.
Chiang asked that Cerberus’ leadership attend CalSTRS’ Investment Committee meeting on Friday “to explain why the Freedom Group remains in its portfolio.”
The state treasurer was initially pleased by a statement Cerberus had issued in late 2012 noting its intent to sell its investment holdings in the Freedom Group.
“We rightly determined that there is significant risk in investing in the Freedom Group, a business that manufactures weapons that are susceptible to sanctions, regulations, and actions that could be detrimental to the fund,” Chiang wrote.
But more than two years later, Cerberus is still invested in the assault weapon manufacturer, an investment that Chiang considers counter to the beliefs of CalSTRS and its 879,329 members and beneficiaries. CalSTRS is the country’s second largest pension fund.
At the meeting later this week, Chiang wrote that he expects to have “a clearer picture” of when Cerberus will “deliver on its promise and remove the Freedom Group from its portfolio.”
A request for comment from Cerberus was not immediately returned.
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