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NY State Pension Fund Linked to Millions in Kickbacks from Private Equity, Hedge Funds

New York (HedgeCo.Net) – Two high-ranking men who worked in the New York State comptroller’s office were arrested yesterday after it was discovered they took millions of dollars in kickbacks from private equity and hedge funds, said Attorney General Andrew Cuomo.

David Loglisci, who was the top investment officer of the state’s $122 billion pension fund, along with Henry Morris, who fund-raised for former comptroller Alan Hevesi, were nailed in a 123-count indictment, which included charges of money laundering, securities fraud and bribery.

It was discovered that over 20 transactions made by the pension fund involved kickbacks, with five of those coming from the renowned private equity fund The Carlyle Group. 

Morris, who was released after posting a $1 million cash bail, allegedly received $13 million from The Carlyle Group, from investments that totaled $730 million.

“Morris used the fund as his own piggy bank and took approximately $30 million in fees for himself and his business partners on investments which Morris himself had a role in approving,” Cuomo said.

Lawyers for both men contend their clients are innocent, saying that all of the transactions benefited the pension fund and were agreed upon by outside financial institutions.  The Carlyle Group has stated they have “fully cooperated with the New York Attorney General’s Office and is not a target of the investigation.”

If convicted, both men could face a life sentence in prison.

Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net

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