Legal News

First Plea in NYAG?s Probe of Shenanigans at Comptroller?s Office

By Amir Efrati

New York Attorney General Andrew Cuomo has grabbed the early headlines this morning with the announcement of charges against more individuals in his long-running criminal investigation into how state officials sold access to billions of dollars held by the state’s pension fund to favored firms in exchange for kickbacks and other payments for personal and political gain. Today’s charges focused on the alleged beneficiaries of the scheme. (Click here for Cuomo’s press release.)

Earlier today Barrett Wissman, who managed Texas-based Hunt Financial Ventures Asset Management, which manages money for the Hunts, the prominent oil family, pleaded guilty to charges of paying kickbacks in exchange for state pension fund investments in HFV. Raymond B. Harding, a past Chair of the former New York State Liberal Party, was also criminally charged for being a “sham placement agent” for three pension fund investments when, allegedly, he was only being paid for doing political favors for state officials. Here’s the complaint against Harding.

Harding allegedly obtained over $800,000 in illegal fees on state pension fund investments as a reward for opening up a New York State Assembly seat for then-Comptroller Alan Hevesi’s son and for over 30 years of prior political endorsements. Wissman, a classical music impresario will pay $12 million in penalties and forfeiture to the state over a period of three years. His guilty plea was first reported in today’s New York Times.

Last month, David J. Loglisci, the state’s former deputy comptroller and chief investment officer, and Henry “Hank” Morris, a top political adviser and chief fundraiser for former New York Comptroller Alan Hevesi, were charged in a 123-count criminal indictment. They have denied wrongdoing. Wissman, the hedge fund manager, is alleged to have paid kickbacks to Morris while working at Hunt.

The Securities and Exchange Commission also has brought a parallel civil case against the four men charged by Cuomo.

Full post as published by Law Blog - WSJ.com on April 15, 2009 (boomark / email).