Marcellus Taylor, who earlier this year was named in a civil suit filed by the New York State Comptroller, has acquired Chicago-based
Until August 2007, Taylor worked as a partner at
The suit accuses Aldus Equity and its principals of taking part in a complicated pay-to-play scheme run by Henry Morris, an adviser to former New York State Comptroller Alan Hevesi, and David Loglisci, the pension fund’s former chief investment officer. The two allegedly received kickbacks in return for awarding business to different fund managers and advisory shops, such as Aldus Equity. According to the complaint, in May 2004 Aldus Equity agreed to pay Morris some of the fees it was earning from creating and managing the
Taylor told Buyouts that his name ended up in the DiNapoli complaint because he was a key man named in the contract with the pension fund. However, he said he never met or spoke with Morris. Taylor added that he believes the complaint is being stayed, but Robert Whalen, spokesperson for DiNapoli, said the state had “no comment regarding this ongoing litigation.” As part of the suit, DiNapoli sought the rescission of its advisory contract with Aldus Equity, reimbursement of more than $5 million in fees, and other damages.
Founded in 2001, United Investment Managers has more than $300 million under management, all of it from six public pension clients including
Prior owner Larry Gray sold his 90 percent interest in the firm to Taylor, with the remaining ownership redistributed to investment staff, including Cheryl Hua and Yolanda Waggoner, who were both promoted to senior vice presidents, and Thomas Zimmerman, who was promoted to chief operating officer. The eight-employee firm has backed some 28 emerging managers in domestic equities, real estate and alternative investments.
Taylor’s resignation from Aldus Equity in August 2007 included a two-year non-compete agreement with
Since the New York State pension fund scandal broke in March, state and federal officials have taken a number of steps to try to prevent future pay-to-play scandals. In late April, New York State Attorney General Andrew Cuomo unveiled a code of conduct regarding investments with public pension funds that calls for the elimination of the use of placement agents and other finders. The SEC, meantime, unveiled a proposal on August 7 that would eliminate the use of placement agents, and outlines a number of restrictions on political contributions.