From the Sacramento Bee:
Yukos assets bid raises concerns By Gilbert Chan – Bee Staff Writer State Controller John Chiang wants the California Public Em- ployees’ Retirement System’s staff to take a hard look at the fund’s investment in Chevron Corp. if the company succeeds in today’s scheduled auction for assets of OAO Yukos Oil Co. Once Russia’s largest oil producer, OAO Yukos is now bankrupt. In a letter to CalPERS, Chiang cited critics, including the U.S. State Department, that have questioned the sale and accused Russian authorities of violating the law by seizing Yukos assets and jailing the company’s former chief executive over fraud charges. “I am concerned that Chevron — which is a top-20 equity holding by CalPERS — may be exposing itself to litigation and divestment campaigns based on allegations of complicity in illegal and unethical activities by the Russian government” Chiang wrote to Russell Read, the fund’s chief investment officer. The fund’s investment in Chevron amounted to $827.1 million, or 0.35 percent of total assets, as of Dec. 31, 2006.