The board that oversees Oregon's college savings plan has hired a Portland firm to keep a second set of eyes on the investments.

The Associated Press

TIGARD — The board that oversees Oregon's college savings plan has hired a Portland firm to keep a second set of eyes on the investments.

Earlier this month, the state sued the plan managers, OppenheimerFunds, accusing it of making inappropriate and risky investments, resulting in steep losses. The fund company has blamed market volatility.

On Thursday, the board of the Oregon 529 College Savings Network hired the consulting company R.V. Kuhns & Associates, whose clients include corporations, public retirement systems, endowments and foundations, and wealthy individuals.

"There is zero tolerance for errors," said state Treasurer Ben Westlund, who leads the five-member board. "It's another set of eyes, another set of expertise to help us make important decisions for the benefit not just of 529 participants but for Oregonians."

The savings network has lost more than 25 percent of its total value since it peaked at $1 billion last year, including bigger than expected losses in plans sold as conservative and ultraconservative.

About 70,000 investors are saving for college for about 100,000 students in the network. It includes three plans that offer tax incentives for contributions under Section 529 of the federal tax code.

The state sued OppenheimerFunds this month to recover at least $36.2 million officials allege investors lost as a result of the firm making risky bets with money that was supposed to be invested conservatively.

Stacey Dycus, Westlund's chief of staff, said officials don't want to be in a situation to depend on a provider to provide oversight and a product.

OppenheimerFunds has both managed and invested money in the Oregon College Savings Plan since the state hired the firm in 2004.

Some investment advisers say the state should have separated those duties earlier, much as the treasurer's office does with the state's $40 billion public pension fund.

"Once again, they're closing the barn door after the horses are gone," said Jay Finley, a fee-only financial adviser in McMinnville.