COLUMBUS, Ohio — Ohio Gov. Mike DeWine is deeply concerned following a recent WEWS report in which we revealed hundreds of text messages of the relationship between a public official and an investment firm seeking to get access to tens of billions of dollars from the state. In an exclusive one-on-one interview, the governor finally addressed the alleged corruption scheme plaguing the retired teachers’ pension fund.
“You're still on this story, huh?” the governor said to me as we were getting started with our 30-minute interview. “While others have lost attention — you stayed on it.”
For the past year, we have dug into — and exposed — the controversy swirling inside the State Teachers Retirement System (STRS), a roughly $100 billion pension fund for the more than 500,000 active and retired public educators in Ohio.
In summary, there has been constant fighting, two board resignations, and allegations of both a public corruption scheme and the mishandling of funds. There has been a senior staff dismissal and at least two senior staff resignations.
The scandal centers around former board member Wade Steen, board chair Rudy Fichtenbaum, and their relationship with investment firm QED Technologies, run by former Ohio Deputy Treasurer Seth Metcalf and Jonathan (JD) Tremmel.
This piece will be formatted as a Q&A, featuring moments from the half-hour interview. It has been lightly edited only for clarity and length, as well as to get to the crux of the comment.
Wade Steen and Seth Metcalf, the men with the relationship at the center of the conversation, also spoke with me in response to the governor’s comments in their own Q&A that can be found here.
How we got here
In May of 2024, the governor received a 14-page anonymous whistleblower memo alleging a massive public corruption scheme brewing and moving quickly within STRS. In 2020, Metcalf and Tremmel set their eyes on STRS, according to the document.
The documents claim that they — despite having no clients and no track record — tried to convince STRS members to partner with them.
They couldn’t impress the board members, mainly because of their lack of experience and also because QED was not registered as a broker-dealer or investment adviser. The men also didn't own the technology to "facilitate the strategy," the documents say.
So what exactly are Steen and Fichtenbaum trying to change, and what would QED allegedly attempt to do? Revise the investment structure. The men are seen as the leaders of the "reform movement." This fight began from a debate on how STRS should invest money — through the current system of actively managed funds versus an index fund. Active funds try to outperform the stock market, have more advisors, and typically cost more. Index funds perform with the stock market, are seen as more passive, and typically cost less.
In short, "reformers" want to switch to index funding, while "status quo" individuals want to keep actively managing the funds. Recent elections have allowed the "reform-minded" members to have a majority of the board.
The STRS memo claims QED and ORTA, the Ohio Retirement for Teachers Association, had worked together, specifically when it comes to elections, to get a more sympathetic — or willing — board.
Steen and Fichtenbaum had allegedly been bidding continuously, pitching QED's direct documents to board members and proclaiming the company's talking points to other staff.
Soon after, Attorney General Dave Yost filed a lawsuit to remove Steen and Fichtenbaum from the board, stating they were participating in a contract steering "scheme" that could benefit them. Yost started the investigation after the memo, now known as being prepared by STRS employees, alleged that Steen and Fichtenbaum had been bidding on QED.
The AG states that the pair should be removed because they broke their fiduciary duties of care, loyalty and trust when "colluding" with QED.
In late August, Yost filed several subpoenas against QED and others allegedly involved in this scheme. The same month, QED spoke out to us for the first time, and so did the AG.
As we have continued the dozens of reports on the topic, our investigation in September revealed that STRS was, once again, moving to hire a firm that allegedly lacked experience and personal ties to the board leaders, according to senior staff.
After our report, the board chose not to move forward with the firm that has been the subject of my investigations.
Communications obtained via a records request of a court filing reveal that QED associates consistently told then-board member Steen what questions to ask, gave him documents to propose, and pushed him to follow its plan.
Texts between Steen, Metcalf and Tremmel show that the pair consistently worked together. There are hundreds of text messages.
Texts show a group chat between Steen, Metcalf and Tremmel. The pair constantly texted Steen during board meetings with advice, including numerous messages of "Vote!" and "Force the vote" when it came to policy and following QED.
"Thanks for the support today!" Steen said.
"Wade - you are a champion! We moved the ball down the field today and have time to recoup and refresh during the holiday!" Metcalf texted the group.
To read what the texts said, click here.
Our reporting stunned the governor, he said, so after more than a year of requesting an interview with him, he agreed to a date in April 2025.
The governor responds
Why are we here? For the teachers to have money when they retire, DeWine said.
Morgan Trau: "What is the importance of a healthy pension fund?"
Ohio Gov. Mike DeWine: "It's very important we have state systems, and this is the teachers' retirement fund, and we certainly want that to be a sound fund. That's always, always something that's a concern, and retired teachers have been concerned about not getting cost of living allowances in the past. The stability of a retirement fund, I think, is very important. It's not just the stability from an economic point, this is an area where stability and less drama is good."
Trau: "Clearly, if we look at the past two years, drama encapsulates what has been happening at STRS. What is going on from your perspective?"
DeWine: "Well, I think things have calmed down. I'm looking at it from afar, but it seems that the board is working, and working in a productive way. I think we've, at least for a while now, we've come over from that problem that we've had in the past."
The problems worsened in 2023. Initially appointed by former Gov. John Kasich, Steen has become somewhat of a martyr, many reformers told me. He was reappointed by DeWine when the governor started his administration, but the governor asked him to resign in 2023. Steen refused, so DeWine removed him. DeWine initially cited Steen’s alleged poor attendance at board meetings as reasoning.
However, a court ruled that DeWine did not have the legal authority to remove Steen based on Ohio law, and thus, Steen was put back on the board in the spring 2024.
I asked the governor during our interview why he had removed Steen, to which he reiterated that his attendance was satisfactory. Steen disagreed.
Trau: "When I talked with your team in May of 2024, they told me that there was also a concern about his close relationship with the investment firm QED and that led you to have doubt in his fiduciary duty."
DeWine: "Well, there certainly was some information going around in regard to that, of course. Then when we got the document, it was an anonymous document, but it seemed to be well informed and I felt I wanted to, frankly, get that document over to elected officials who might have an interest in investigating or might have an obligation to investigate it."
Trau: "When it comes to the pension fund and the allegations that are against former board members, the current board chair – what kind of outcome could happen if these allegations are all true?
DeWine: "Well, I don't really know. I've not followed the attorney general's suit that closely, but when you look at what you have been able to uncover, the things that have been filed in court... I would just call it a concerning set of facts. It’s very concerning that you have that close a relationship, going back and forth between a member of the board and the company that wants a job, basically. They want to be hired and clearly, you see [Seth] Metcalf, for example, going back and forth. It just seems to me that that's very, very disconcerting. It's very upsetting, and it raises a lot of questions. Now, we'll see where the lawsuit goes and we'll see what the final verdict is. I'm not going to prejudge that at all, but based upon what you are reporting — yeah, it doesn't look very good."
Pulling out some of the text messages I obtained, I passed the documents to the governor to look through.
Hundreds of texts show Metcalf gave Steen questions to ask during board meetings, documents to propose, and pushed him to follow QED's plan.
"I think we can win this but I need to nuisance it," Steen texted in 2020, as he was pitching QED's proposal.
"I think you've got the votes! Make the motion! Announce that you have a solution," Metcalf responded.
Metcalf continually texted talking points, themes and direct quotes for Steen to follow while he was in the board meetings.
Steen followed his lead.
Trau: "What do you think about the fact that they were giving directions during board meetings and they were giving quotes to say and those quotes were then said out loud?"
DeWine: "It would be highly, highly, highly unusual for that to happen. A member of the board has a fiduciary obligation to all the people he or she represents. They have an obligation to the retired teachers. They have an obligation to people who are currently putting their money into that — current teachers. So, for that person to have that close of relationship with a person who is basically coming to the board and saying ‘Hire us, we know what we're doing,’ – yeah, it's not a normal situation, let's put it that way. Again, I can't judge it. All I can tell you is what you have seen and what you've pulled from the court documents."
Evaluating the text message threads with numerous legal and pension industry experts, each indicated suspicion, with Case Western Reserve University law professor, joined by others, adding that this could be used to argue there was a level of coordination.
Trau: "You are an attorney, and when you look at this, does this look like coordination to you?"
DeWine: "Well, I'm not gonna draw any legal conclusions, but just knowing what each role these players are supposed to be playing – they're not playing their normal roles. That's not what we would normally expect... The member of the board is supposed to be impartial and supposed to be making a judgment call based upon what is in the best interest of STRS, in this case, and ultimately in the retired teachers."
I referenced how familiar Metcalf and Steen spoke to each other.
Trau: "Should we be paying attention to the language that this investment firm is using when talking to a board member?”
DeWine: "Well, it's unusual language — let's just put it that way."
Trau: "Obviously, there are people who back Wade Steen extensively. There has been a legal fund with thousands of dollars given to him to fight the removal and to fight this current lawsuit against Attorney General Dave Yost. Some of these people, even with these text messages, say that this is political interference. How do you gain back the trust of these pensioners that believe that you and AG Dave Yost are wrong?
DeWine: "Well, the only concern I've always had is for the board to function well and to make good judgments, do the best that they could for the retired teachers. I see retired teachers all the time. They've worked very, very hard. Teachers are the people that educate our kids. Everybody can remember a teacher, more than one teacher, who literally changed their life. These are important people and we need to do the best we can for them.
I don't want to be a member of the board. I'm not looking over everybody's shoulder. We just have to have a functioning board, that makes decisions based upon what is in the best interest of these teachers. When they pick the investment advisors, you would think that they would be picking people who are experienced and people who have a good track record. You're not always going to be successful with every investment, but what you have to look at is the totality of the investments."
Trau: "Do you feel vindicated by the texts coming out?"
DeWine: "Well, I don’t know if vindicated. Look, we're simply after what's best for the retired teachers."
I noted how DeWine removed Steen during a critical election when the reformers took control of the board and then released the 14-page memo during another pivotal election when the reformers took a supermajority of the board. With this dominance, they would be able to start shifting the investment structure, something that reformers claim DeWine wants to prevent.
Trau: "Some argue that that timing is suspicious. Could you see why they would say that?"
DeWine: "Well, it's not true. We were trying to get the information out, for example, in regard to the memo we got. We, very quickly, got it over to six different officials, public officials, who we thought and believe they do have investigative authority, or have the ability to act, upon that memo. I really did not have the ability to act upon that memo... When you see very serious allegations like that, we have to get that document over to the people who have an obligation to take action."
I referenced the reformers' goal of switching the investment structure.
Trau: "Do you think that that would yield better results than right now? And should they have had the opportunity, if the majority on the board wants to do that, should they be able to do that?"
DeWine: "Well, if the majority wants to do that they certainly can do that. For the average citizen, I think investing in the stock market, following investment in funds that allow you basically to get the return or lack of return that the whole stock market is getting, that makes some sense... Pension funds take a more conservative point of view. They have to be paying out so much money every single month, they have to be paying out every single year, and they don't want to have a great risk, so they will be much more diversified even than that... And what Metcalf was selling was something that would be very, very unusual for a pension fund."
I noted Metcalf's history, asking why the governor thinks someone may be entered in giving 70% of a pension fund to a startup without the technology to pull off the plan. DeWine emphasized how Metcalf was not qualified.
There are real, valid concerns from educators — DeWine acknowledged — but as we have reported, STRS is doing better than most of the other state pension funds.
"I do hear from teachers about how much the advisors were getting paid," the governor said. "I think you have some people who are just looking at this and saying, ‘Look, these people are paid too much money,’ and look, those are legitimate discussions that people can have and they can believe they're getting too much or you can argue they're not getting too much. But those are, I think, some of the reasons that people were getting upset."
The investment staff get paid by salary and performance-based incentives (PBIs). Losing these bonuses could slash up to half of their salary, former STRS chief actuary Brian Grinnell told me in July.
The average yearly "salary" for STRS investment staff members was roughly $230,300, that number including PBIs, as they have typically been approved for $10 million in bonuses per year. The board voted to eliminate the PBIs to make the reformers happy, resulting in their major compensation advisor quitting and their fiduciary counsel telling them they were violating the law. They reinstated them soon after.
But it's been a tough few years financially, and it doesn't seem to be getting better. I noted this, the current look at the stock market, inflation, and the fiscal hits people faced from COVID. COLA could help retired teachers. The Retirement Study Council said they are on track to restore it in a decade fully.
Trau: "People are suffering with this and they are very upset. They are, many of them, blaming you for this oversight of the board. Is that fair?"
DeWine: "Well, I get one person on the board, so I only have one person on the board that I appoint. I guess you can blame the governor for anything, but my concern has been the same and my goal has been the same — and that is to have board members who are going to focus every single day on the best interest of the retired teachers."
Referencing how DeWine had said the board had calmed down, I mentioned their attempt to hire a consultant firm without relevant experience with ties to the board members. Our investigation disqualified them due to their staff contacting the board members during a “blackout period,” when the interview process is underway and communicating isn’t allowed.
Trau: "Are we not looking at it seriously by saying that it's calming down?"
DeWine: "Well, everything is relative. It certainly calmed down some. If I was a member of the board, I think I would remember my fiduciary obligation to the retired teachers and every decision I made doesn't mean every decision will be right, but what I would have in my mind every single day, every time I went to the committee meeting, every time I attended the meeting, every time I thought about this, ‘What's in the best interest of the teachers and what should these investments be and who should be advising us.’"
Trau: "Some lawmakers have suggested that due to the controversy that is happening right now with the board, some of the voting power should be taken away from the educators — making them members of the board but just not voting members or taking down how many people. The teachers say that that would be undemocratic. Where do you stand?"
DeWine: "Well, I'm not advocating any kind of change. The board members are not experts, their job is to hire experts... Their job is to pick the right people who have a track record of investment and continue to have that oversight that the board should have."
RELATED: Ohio lawmakers may remove teachers' pension board voting powers as chaos continues
Talking about hiring the right people, I brought up the text messages and how QED still wants a job. Metcalf has said that their plan will work to bring in money, and they can make it better. Regarding the messages, I followed up with the governor on his concerns.
Trau: "When did you think it was unusual, was there a specific text message or was it just overall?
DeWine: "Well, you're talking about what you pulled from the filings. Frankly, you put it all together in a form that people could read it. So I didn't read all those, I didn't have those pulled. I read it when you had it put together and you had all those laid out... Once you read it, I think anybody reads it, would be concerned about it."
Trau: "When I've talked with QED, they've said that there's nothing illegal about potentially acting as consultants or advisors to Steen because they say they know more than him when it comes to the investment structure. Do you believe that you know he could just be talking to them for advice?
DeWine: "Well, I think people can come up with their own conclusions on that."
Trau: "What's yours?"
DeWine: "Well, l again, I don't know what's in someone's heart. I don't know what's in their mind. I just know that is a very unusual relationship, a very close unusual relationship."
The governor wouldn’t comment on whether Metcalf, who worked in state government for years, should have known better than to communicate with a board member in the way he did.
Trau: "Some critics argue that with your text messages with FirstEnergy CEO Chuck Jones, [where] they ended up putting $500,000 in a dark money PAC for you, some argue that there's no difference between that and QED contacting. Is that fair?"
DeWine: "No, I don't think so. What we did is perfect, perfectly legal. You report contributions."
A public records request reveals that DeWine communicated frequently during his first run for governor with Jones and VP Michael Dowling. The pair held lavish fundraisers before he was elected, with Jones giving speeches about how DeWine would be great for "his company and shareholders," a speech I received said. Plus, Jones provided the now-governor money when he asked.
Referencing QED, I followed up. We had, earlier, talked about his thoughts on if there was a campaign waged behind the scenes to get certain people elected. He said he didn't know.
Trau: "Are you saying that there might be some financial involvement?"
DeWine: "I'm not alleging anything about what they were doing... People have a right to wage a campaign as long as they stay within the law. They have a right to raise money and they have a right to push somebody to be on STRS’ board. To my knowledge that, per se, is nothing illegal about that. This is a free country. People have the right to speak out and they have the right to give money to a candidate and they have the right to advocate for that candidate."
Trau: "But the same people argue that the closeness in your relationship with FirstEnergy executives could be comparable to QED and Wade Steen, Rudy Fichtenbaum."
DeWine: "Well, it's a different situation. I mean the situation in regard to the board is that these two members of the board have a fiduciary relationship and a fiduciary obligation. And you have someone who is pitching them, not in their individual capacity. They weren't going to hire them to do their individual work. They were going to hire them as a member of the board and that is what is questionable I think."
Through a short back-and-forth, I clarified with DeWine about why he thought the communication was different.
"I think it is really comparing apples and pears or something, I think it's really different," DeWine continued. "This is a board which has a fiduciary obligation... They have a legal obligation to give their best judgment, so you read that and draw your own conclusions from that."
I brought up the future for Steen since he had told me during his last meeting for the board that he wasn’t sure if he was entirely done with STRS yet. His supporters have suggested him for the executive director role, CFO, or CIO.
"Whether it's a wise move or not it's a different question," the governor answered. "I think it'd be a mistake to put Steen back on there. I'm not going to reappoint him."
Trau: "Moving forward, it seems the board has realized they can't do everything that they want to do with totally changing how the investment structure works. Do you think that this is going to have to be an ongoing process where eyes are on it at all times because people could still try to hire their friends?"
DeWine: "Well, I think the public's eyes, thanks to you... are on them, and that's always a good thing, They have to make these decisions out in public so I think that's that's a good thing."
We also touched on Signal, an encrypted app that deletes conversations within a set period of time. QED used Signal frequently to speak to Steen and Fichetnbaum, even recently as last year. They used it to talk to me, too, until I reported the existence of Fichtenbaum's deleted messages to them.
Trau: "Should public officials be allowed to be using apps where they delete and they're encrypted?
DeWine: "Well, we've got pretty good strong laws today, as you know. No matter what your means of conveyance, that really doesn't matter. That doesn't give you any legal protection. What makes you, makes the news media or anybody in the public, able to get information is if you were acting in your official capacity."
Trau: "Sure, we have them when they exist, but when it's Signal and they delete automatically within reading of them — should there be a prohibition on the fact that they can delete without being under FOIA (Freedom of Information Act that allows the public to records request and get access to documents)?
DeWine: "Look, as technology changes and it advances or regresses depending on how you want to look at it, we constantly should be looking at, see what needs to be changed. But I don't know in this case whether that should be changed or not."
Trau: "What do you think could be the best outcome in this situation to prevent against corruption under STRS?"
DeWine: "Well, the best outcome could be if there continues to be light on the subject, as they say, and these decisions are made out in the public. I mean, people are paying attention. You're paying attention… That's a good thing."
He noted the unpredictability of being tied to the stock market, especially now. It is good to have a diversified portfolio, he added.
Trau: "How do you get people to believe you when they think that you're trying to interfere against reform?"
DeWine: "Well, I have no reason to interfere against reform. I have every reason to try to make sure the retired teachers get a good deal, and that they're taken care of... What I don't want is to see chaos on that board, and what I don't want is bad investments and people be hired who do not have the experience to make those investments."
Trau: "What would your goal be? What is your one thing that you would want to say in this interview to pensioners and people who are struggling with the fact that they don't know what's going on?"
DeWine: "Well, I think the opportunity to know what's going on is better than it was. I think people are paying attention to this board, they're looking at it and that's a good thing. It's a very, very good thing."
To ask questions or provide comments about STRS, please email Morgan.Trau@wews.com with the subject line "STRS COMMENT."
Sources are welcome and encouraged.
I have covered all different angles of this story, including ones focusing on the educators and their lack of COLA, how lawmakers are responding and investigations into archived meetings. Most stories are linked to the previous, but chronological order can be found by going to this page, scrolling down and clicking to the fourth page back to find the first piece.
Follow WEWS statehouse reporter Morgan Trau on Twitter and Facebook.
