INDIANAPOLIS -- A former state pension employee was taken into custody Monday.

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Walter Kevin Scott Scott (pictured, left) is accused of stealing another Kevin Scott's Social Security number when he applied for his job at the Public Employees' Retirement Fund, so he could hide his criminal past, RTV 6's Norman Cox reported.

State officials suspended Scott Aug. 13 after they learned from The Indianapolis Star of his 1996 conviction on federal bank and mail fraud charges. He resigned the following day.

The Secret Service has also joined a criminal inquiry into a convicted felon's management of the $11 billion state retirement fund.

Scott surrendered to authorities Monday and made his first appearance in federal court in the afternoon, Cox reported.

Scott was released without bail pending an appearance before a grand jury, but the judge forbade him from using a computer, opening any new credit accounts, or moving more than $500 between existing accounts.

Scott was hired in November as the fund's chief benefits officer, beating out 36 other people for the position that carries an annual $95,000 salary.

He had previously served two months in a Kentucky federal prison and spent three years on probation for stealing the identities of two people.

Scott had access to the Social Security numbers, addresses and birth dates of more than 200,000 retired and working public employees. So far, state officials have not said how or why he was chosen for the position.

Gov. Frank O'Bannon has tried to reassure public employees that their pensions are safe, but Republicans have been demanding answers, Cox reported.

"It is patently obvious that PERF does not have an institutionalized background check process," Sen. Murray Clark said. "That's startling to me."

But O'Bannon called Scott's arrest a first big step, and denied Republican charges of stone-walling, Cox reported.

"We've just got our investigations going, and until they are finished, we can't give all the answers, even though there's a lot being requested at this time, until we know exactly what happened, and if there was any wrong-doing that would have hurt anyone," O'Bannon said.