Investors in New Jersey purchased more than $26 billion worth of state bonds over the past six years directly correlating to the misrepresentations of the state’s public pension fund.

New Jersey, which holds one of the country’s largest pension funds, was accused of securities fraud on Aug. 18 after claiming it had been properly funding worker’s pensions when in fact they had not been.

Individual state officials were not named by the S.E.C., raising the question, where is the accountability?

Bond underwriters responsible for vouching for the state’s financial statements were not specifically named either. The New York Times reported underwriters during the period in question to be, Citigroup, J.P. Morgan Securities, Morgan Stanley, Bank of America, Merrill Lynch, Goldman Sachs and Barclays Capital.

The S.E.C stated from 2001 to 2007, New Jersey claimed to be placing money into a “benefit enhancement fund” to pay for teacher benefits and general state employees.

The funds were never available.

The Securities and Exchange Commission has never taken action against a state for mishandling a public pension fund. San Diego was just the second instance where the S.E.C has taken action against a government for this kind of violation.

The action taken in New Jersey’s case was a cease-and-desist order that was handed over without any admission of wrongdoing.

Although no penalties were imposed on New Jersey, the findings are meant to serve as a warning for states like California, New York, and Illinois that are all having similar financial struggles relating to public pension funds.

The S.E.C has been assuming more authority over local municipalities, and this only gives the agency more leverage to do so.

Former chief accountant for the S.E.C said in the New York Times, “There’s no fine, and no accountability on the part of any individuals.”