CalPERS today severed its ties with Pacific Corporate Group, a longstanding investment advisor that had close ties to the man accused of bribing CalPERS officials.

The big pension fund said Pacific Corporate Group, based in La Jolla, would no longer manage more than $1 billion worth of money for the California Public Employees' Retirement System. Pacific Corporate Group has been working for CalPERS since 1990.

Pacific Corporate is being replaced by two firms, Aviva Capital LLC and Capital Dynamics.

Earlier this year, Pacific Corporate lost its job advising CalPERS on investments proposed by others. But until today the La Jolla firm was still managing several CalPERS portfolios, including one dedicated to clean-tech.

The pension fund wouldn't explain its decision to fire Pacific Corporate. But the firm had close ties to Alfred Villalobos, the Nevada businessman accused in a lawsuit of bribing three former CalPERS officials in an effort to steer investments to his clients.

In 2007, Villalobos intervened on Pacific Corporate's behalf when it was in danger of getting fired by CalPERS. He helped negotiate a restructuring of the firm that put CalPERS at ease. He also was hired by Pacific Corporate in an unsuccessful effort to persuade CalPERS to buy an equity stake in the La Jolla firm.

CalPERS also indicated last year that it was "troubled" by Pacific Corporate's involvement in a corruption probe in New York state's public pension fund. Pacific Corporate paid $2.1 million to resolve the matter in New York, following the disclosure that a former Pacific Corporate executive made a secret deal with a political operative who had control over the pension fund.

Reacting to the firing by CalPERS, a Pacific Corporate spokesman issued a statement noting that in its 20 years working for CalPERS, it has earned the pension fund more than $3 billion in profits.