Firm of ex-Obama aide settles corruption probe
Posted: 5:23 pm Thu, April 15, 2010
NEW YORK — An investment firm founded by President Obama’s former car czar Steven Rattner has agreed to pay $12 million to resolve allegations that it paid kickbacks to drum up business from New York’s giant government pension fund.
The Quadrangle Group said it would refund $7 million to the pension fund and pay another $5 million to the Securities and Exchange Commission as part of the deal, which was announced Thursday.
The settlement covers only Quadrangle, not Rattner, who left the firm last year to become co-leader of the presidential task force that restructured the auto industry.
It leaves open the possibility that Rattner — a major political fundraiser, friend to media giants and influential policy figure — could still face a lawsuit from either the SEC or New York Attorney General Andrew Cuomo.
Quadrangle has acknowledged paying more than $1 million in finders fees to a political consultant, Hank Morris, in exchange for his help landing a lucrative state investment contract. Morris was a longtime aide to state Comptroller Alan Hevesi, who controlled the pension fund until his resignation in 2006.
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