The agreement calls for PCG to adopt a code of conduct governing pension investments, and for an affiliate to pay more than $2 million in restitution to the
A spokesman for Cuomo had no immediate further comment.
Cuomo is conducting a nationwide probe into whether private equity firms and hedge funds are making improper payments to win pension fund business, a practice known as “pay-to-play.”
Private equity firms The
PCG is the first pension fund adviser to adopt the code.
Cuomo said his probe revealed that the PCG affiliate was a minority partner in a joint venture that paid kickbacks to win a $750 million investment from the $109.9 billion New York Common fund, one of the nation’s largest public pension funds.
“As a gatekeeper to public pension funds, PCG has a responsibility to exercise the highest level of ethical conduct in its work,” Cuomo said in a statement. “By proactively adopting our Code, PCG has set an important example.”
In March, a grand jury returned a 123-count indictment against David Loglisci, the fund’s former chief investment officer, and Henry “Hank” Morris, a top fund-raiser to former state Comptroller Alan Hevesi, related to the case.
The Securities and Exchange Commission has also accused Morris of reaping kickbacks from helping firms get hired to invest in the Common fund.
PCG, in a statement released by Cuomo, said it settled “to make the public whole for the improper actions of a former executive, to put this episode behind us and to move our business forward.”
The company referred a call to outside spokesman Daniel Hilley, who declined to elaborate. —Jonathan Stempel, Reuters