The "Duh!" factor in this story is astounding in its immensity.

Published: February 10, 2004

For more than a decade, a small group of businessmen contributed tens of thousands of dollars to the campaigns of their county commissioners in Luzerne County, a waning coal center in eastern Pennsylvania. The elected officials gave the businessmen control over the county pension fund, about $200 million at its peak. After hiring insurance companies, brokerage firms and others to manage the money, the businessmen reaped several million dollars in commissions and fees from the companies.

No one paid much attention until the market went sour. Then a quarter of the pension fund melted away. A new county controller was elected, and he concluded the flow of political money had undermined the fund.

"It was a pay-to-play system," said Stephen L. Flood, who was elected controller of Luzerne County in 2002 and ordered an audit of the fund. He and the county pension board have filed a racketeering suit against the businessmen, the county commissioners and the companies that have handled the pension money since 1988, contending that they chose unsuitable investments and drained millions of dollars through excessive fees.

The case, detailed in the lawsuit, is an unusually stark example of a claim that has been made from Connecticut to California: when elected officials sit on government pension boards, investment decisions can be tainted by campaign contributions.