The scandal surrounding New York State’s pension funds keeps unfolding like a serialized novel, tarring more of New York’s political class all the time. Today’s chapter, revealed by State Attorney General Andrew Cuomo, is one of the most fascinating yet. Cuomo announced a $12 $7 million settlement with the Quadrangle Group, a private equity firm that had been accused of paying kickbacks to get access to the state’s investments (Quadrangle will pay another $5 million to the S.E.C). But Steve Rattner — Quadrangle’s most famous (now former) partner, Democratic fund-raising powerhouse, ex-manager of Michael Bloomberg’s fortune, and erstwhile Obama Administration car czar — is still firmly on the investigation’s hook. Cuomo’s statement today said the settlement “expressly does not cover former Quadrangle managing principal Steven Rattner” and Quadrangle said it will be fully cooperating with Cuomo’s ongoing investigation.
Today’s biggest loser, however, has to be current state comptroller Tom DiNapoli. For months, Cuomo has hinted that someone still active in the comptroller’s office was involved in the dubious practice of using politically wired middlemen to broker access to the state pension funds. Now Cuomo has put DiNapoli at a 2007 meeting with pension-fund investors; the sit-down, Cuomo says, was arranged by a partner at Global Strategies Group, one of New York’s premier political-consulting firms (Cuomo himself has been a client, during his 2006 attorney-general campaign). Two weeks after the DiNapoli meeting, the state added $15 million to its existing $50 million investment.
DiNapoli — who was appointed comptroller after the resignation of Alan Hevesi, one of the scandal’s first dominoes — was already facing a difficult run for comptroller this fall. No doubt Cuomo and his investigators are simply following the facts of the case. But whenever he officially becomes a candidate for governor, Cuomo will need to be very careful lest he be seen as trying to push DiNapoli out in favor of an ally.
