The New York Attorney General office’s investigation into an alleged pension pay-to-play scheme is setting its sights on 20 investment firms and whether they violated securities laws in pay fees for access to the New York state pension fund, reports the Wall Street Journal.
Attorney General Andrew Cuomo announced that his office criminally charged Raymond Harding, the former head of New York’s defunct Liberal Party, for allegedly receiving $800,000 in illegal fees.
Gary Naftalis, Harding’s lawyer, told WSJ, “Ray Harding is innocent of these charges.”
The attorney general also announced that ex-hedge-fund executive Barrett Wissman has pleaded guilty to criminal securities fraud in connection with his rols as an intermediary between the pension fund and investment firms. “From 2004 to 2007, Wissman acted as a finder in connection with certain investments that were presented to the New York State Common Retirement Fund,” said William A. Brewer III, Wissman’s lawyer. He said Wissman is cooperating in the investigation.
Authorities from the attorney general’s office and the Securities and Exchange Commission will be spending more time examining investment firms to assess whether the payments they made to receive pension money were improper. Cuomo told WSJ that he does expect additional charges.
Among the firms named in court documents as having paid fees to get business from the New York fund are the private-equity specialists Carlyle Group and Odyssey Investment Partners, and a hedge fund and a private-equity fund associated with Pequot Capital Management.