The California Public Employees’ Retirement System is reviewing a batch of improper personal trades an employee made two months ago, according to the fund.

The system recorded a spike of 133 violations of its employee trading policy in March, according to an audit the system’s compliance unit prepared for the CalPERS board’s April meeting.

One person was responsible for 86 percent of the March violations, CalPERS spokesman Wayne Davis said in an email.

The violations are under review and the fund will take action based on the results, potentially including dismissal, Davis said.

CalPERS regulates personal trades among more than 400 employees in its investment office, information technology office and others who have advance knowledge of planned trades, along with their spouses.

To make personal trades, employees have to enter details of the proposed transactions and receive clearance through an online platform under the fund’s employee trading regulations. Some trades are exempt, such as those in automatic investment plans.

Fifty-three of the 133 violations in March were pre-clearance violations, according to the audit report.

CalPERS prohibits personally trading the same stocks the fund is trading within given windows of time before or after CalPERS makes its trades. The rest of the March violations were related to those policies, according to the report. One trade can trigger multiple violations, the report says.

There were no violations of the fund’s “restricted list” policy, which would involve trading in companies about which employees have non-public information.

Normally the system identifies fewer than a half-dozen violations per month, the report shows. The violations took place as international markets tanked and then began to rebound after the arrival of the coronavirus.

CalPERS had reached a record high value of more than $400 billion before the markets tanked. The fund’s value sank to $335 billion before rebounding. Its value stood at about $376 billion at the end of the day Tuesday, which is slightly higher than at the end of the last fiscal year.

This story was originally published May 21, 2020 at 6:15 AM with the headline "CalPERS reviewing improper personal trades an employee made as markets swung in March."