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SEC Accuses Rattner in|NY Retirement Scandal

MANHATTAN (CN) - The SEC today accused Steven Rattner, a former managing partner of the Quadrangle Group, of paying kickbacks to secure $150 million in investments from the New York State Retirement Fund.

The 14-page federal complaint claims Rattner was part of "a wide-ranging scheme to extract kickbacks from investment management firms seeking to manage assets held in trust by the New York State Common Retirement Fund. ... The primary perpetrators of the scheme were Henry Morris ('Morris'), the top political adviser and chief fund raiser for former New York State Comptroller Alan Hevesi, and David Loglisci ('Loglisci'), the former New York State Deputy Comptroller."

Morris, Loglisci and others already have been charged in the pay-to-play scheme.

"In the instant action, the Commission charges Rattner, a former managing principal of the private equity firm Quadrangle Group LLC ... for entering into undisclosed quid pro quo arrangement with Morris and Loglisci in order to secure an investment from the Retirement Fund."

The SEC claims Rattner secured the $150 million for Quadrangle by arranging for Quadrangle to distribute the DVD of a low-budget film that Loglisci had produced with his brothers, "and by agreeing to pay more than $1 million in purported 'finders' fees to Morris".

The SEC seeks disgorgement and penalties, and it wants the judge to tell Rattner not to do it again - ever.

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