Corrupt car tsar cuts deal

[David Guyatt]

Another example where corruption is rewarded.

No prison for the wealthy - just take a cut out of their ill gotten gains and send them on their way -- and allow them to continue trading.

Unreported is the sum of money Rattner made from dirty his dealings?

Obviously.

Corrupt car tsar cuts deal:

Steve Rattner, US 'car tsar', pays $10m over bribery claims

Banker who advised US government on auto industry bailout settles over allegations he paid kickbacks to win state pension fund investments

Dominic Rushe in New York
The Guardian, Friday 31 December 2010


Steve Rattner, who agreed to pay $10m to settle allegations he paid kickbacks to help his company win state pension fund investments

Steve Rattner, the investment banker and former White House adviser, has agreed to pay $10m (£6.5m) to settle bribery allegations brought by New York's attorney general, Andrew Cuomo.

Rattner, who as "car tsar" advised the US government on its auto industry bailout, had been facing legal action over allegations he paid kickbacks to help his company land $150m in state pension fund investments in 2004 and 2005. Rattner denied the charges and has admitted no wrongdoing as part of the settlement.

Cuomo had initially sought to have Rattner banned from the securities industry for life and have him pay $26m in fines and penalties. But in the settlement Rattner, a founder of private equity firm Quadrangle Group, will pay $10m and be banned from appearing in any capacity before any public pension fund in the state of New York for five years.

The suit pitched two of New York's most powerful men against each other. After close to two years of investigation Rattner's camp complained that Cuomo, who is replacing his father Mario as New York state's governor, declared war on the day that General Motors returned to the stock market, a day that should have been a triumph for Rattner.

The Securities and Exchange Commission (SEC) had also investigated whether Rattner was guilty of "pay-to-play". It alleged Rattner helped distribute a low-budget film called Chooch that was being produced by the brother of one of New York's top pension fund officials. Those claims led to a $6.2m fine for Rattner and a two-year ban from associating with any investment adviser or broker dealer.

In a statement Cuomo said: "I am gratified that we have been able to reach an agreement in this case, as it resolves the last major action of our multi-year investigation. The state pension fund is a valuable asset held in trust for retirees and supported by taxpayers. Through the many cases, pleas and settlements in this investigation, I believe we have been able to help restore and protect the integrity of the state pension fund."

In a statement issued in conjunction with yesterday's agreement, Rattner said: "I am pleased to have reached a settlement with the New York attorney general's office, which allows me to put this matter behind me.

"I apologise if during the course of this process there is anything I did that may have made reaching this agreement more difficult. I respect the work of the attorney general and his staff to ensure that the New York State Common Retirement Fund operates properly and in the best interests of New Yorkers."

Cuomo said his investigation of pension kickbacks had resulted in agreements with 19 firms and five individuals, garnering more than $170m for New York and the pension fund.