Michigan pulls $600 million from Ken Fisher after lewd remarks

Breana Noble

The state of Michigan has pulled $600 million in state pension funds from a Washington investment firm after attendees at a business conference last week said the company's billionaire founder made lewd remarks.

Michigan Department of Treasury’s Bureau of Investments on Thursday terminated the approximately 15-year relationship with Fisher Investments after Ken Fisher made "completely unacceptable comments" at a conference on Tuesday, said Jon Braeutigam, the department's chief investment officer, in a letter obtained by The Detroit News to the State of Michigan Investment Board on Thursday.

Ken Fisher

The Washington Post first reported the state pension fund’s termination.

Fisher was a featured speaker at a fireside chat at a conference hosted by California-based Tiburon Strategic Advisors. Fisher compared his wealth management strategy to soliciting women for sex, made explicit remarks about genitalia and mentioned late financier Jeffrey Epstein, who was criminally charged with running a sex trafficking ring before dying by suicide in August, the Washington Post reported based interviews with conference attendees. The 68-year-old Fisher also spoke of doing acid and his belief that charities are immoral, according to the Washington Post report.

The Post reported that Fisher later issued a formal apology on Thursday. Messages were left Sunday night with Fisher Investments. The Detroit News spoke with a man listed as Kenneth L. Fisher, 68, in Camas, Washington. When asked about the pulled funds, he replied, "I'm not interested," and hung up the phone.

The funds pulled by the state now will be managed internally, Braeutigam said in the letter. The State of Michigan Retirement Systems has more than $70 billion in assets.

"There is no excuse to not treat everyone with dignity and respect," Braeutigam said. "We have high expectations of our managers (and staff), not just with regards to returns but also in how they exhibit integrity and respect to all individuals."

The Investments Bureau became aware of the remarks after media reports. After further verification, the bureau's leadership unanimously agreed that "prompt termination is the correct course of action," Braeutigam said.

Fisher Investments, which manages $112 billion for individuals, families and institutions around the world, "has been good," Brautigam said, noting its results beat the S&P 1500. State of Michigan staff had not previously witnessed or been aware of similar comments, he noted.

"In our opinion, this history does not outweigh the inappropriateness of the comments made by the founder," Braeutigam wrote.

Fisher Investments also manages public employee pension funds for Iowa, which has called his remarks "concerning," according to Bloomberg.

The Tiberon CEO Summit has a "no media policy," but in audio obtained by CNBC, Fisher is heard saying, "I'm kind of like an open book, but most people don't want to read it."

Members of the business community since the remarks have voiced their concerns online and on social media.

Managing Partner Charles "Chip" Roame, who was on stage with Fisher, on Thursday in an open letter condemned the "old boys club" phrases and said that Fisher "will not ever be invited back to a Tiburon CEO Summit."

"I was extremely disappointed by the comments that I heard in the way that I understood them," Roame wrote. "I can, in no way, condone or find acceptable what I heard in the way that I understood its intent. These comments lacked the dignity & respect that should be expected by any Tiburon CEO Summit speaker or attendee. These were unacceptable words at Tiburon, in the wealth & investments industry, and in society generally."

Hours after the incident on Tuesday, Alex Chalekian, founder of California-based Lake Avenue Financial, called Fisher's remarks "a true debacle" in a video on Twitter.

"Things said by Ken Fisher were absolutely horrifying," he said. "Talking to some of the men and women, they were disgusted by this. Many of the women expressed to me this is one of the reasons why they don't like coming to these conferences. It makes them feel very uncomfortable and this obviously doesn't help the situation."

Sonya Dreizler, founder of investing company Solutions with Sonya, on Wednesday confirmed Chalekian's comments when she posted a statement on Fisher's speech on Twitter.

"The conference content is supposed to be kept private, so that CEOs can be candid about internal business opportunities and challenges," she wrote. "Since this content is not about business issues, I'm choosing to break that code of privacy to confirm that the comments from the stage were indeed outrageous."

Rachel Robasciotti, founder and chief executive of wealth management firm Robasciotti and Philipson in San Francisco, on Wednesday retweeted Chalekian's post, saying Fisher's speech was "one of the most disgusting and disappointing moments in my career."

Fisher founded his investment company in 1979 with only $250, according to Forbes, and is worth $3.8 billion today. He also has written 11 books and has a finance column with USA Today.

“I have given a lot of talks, a lot of times, in a lot of places, and said stuff like this and never gotten that type of response,” Fisher said in an interview Wednesday with Bloomberg, adding he thought his comments were taken out of context. “Mostly the audience understands what I am saying.”

On Thursday, Fisher took back his comments and apologized in a statement to CNBC.

“Some of the words and phrases I used during a recent conference to make certain points were clearly wrong and I shouldn’t have made them,” Fisher said. “I realize this kind of language has no place in our company or industry. I sincerely apologize.”

In a letter to employees on Friday, according to Bloomberg, Fisher Investments CEO Damian Ornani said the firm plans to start a diversity and inclusion task force.


Twitter: BreanaCNoble

Bloomberg contributed to this report.

Read the full Oct. 10 letter from Michigan's Chief Investment Officer Jon Braeutigam

Board Members,

This morning, the Michigan Department of Treasury’s Bureau of Investments (BOI) terminated Fisher Investments as their founder Ken Fisher made completely unacceptable comments to a conference group where he was a featured speaker. BOI became aware of this situation last night after reading an industry news article and, after leadership discussions this morning (and more verification), all were in unanimous agreement that prompt termination is the correct course of action. There is no excuse to not treat everyone with dignity and respect. We have high expectations of our managers (and staff), not just with regards to returns but also in how they exhibit integrity and respect to all individuals.

Fisher Investments was one of our long-time active domestic equities (managed funds for approximately 15 years) managers and they were responsible for managing over $600 million of State of Michigan Retirement Systems (SMRS) funds. Over the years, their performance has been good (beating the S&P 1500) and in staff’s interactions we have not previously witnessed or been aware of any type of similar comments along the lines of the founder’s recent statements. In our opinion, this history does not out-weigh the inappropriateness of the comments made by the founder.

The securities Fisher Investments managed are all held in the retirement systems’ name and in the retirement systems’ custodial bank (State Street). These funds will now be managed internally and over time will be liquidated and moved to cash in order to pay retirement benefits.


Jon M. Braeutigam