The SEC alleges that Quadrangle Group LLC and Quadrangle GP Investors II, L.P. secured a $100 million investment from the New York State Common Retirement Fund, but only after a then-executive at Quadrangle arranged for an affiliate to distribute the DVD of a low-budget film that former New York State Deputy Comptroller David Loglisci and his brothers had produced, according to a press release.
The SEC further alleges that the Quadrangle executive also agreed to pay more than $1 million in purported “finder” fees to Henry Morris, the top political advisor and chief fundraiser for former New York State Comptroller Alan Hevesi. The SEC previously charged Morris and Loglisci for orchestrating the fraudulent scheme that extracted kickbacks from investment management firms seeking to manage the assets of the Retirement Fund.
Quadrangle agreed to settle the SEC’s charges, without admitting or denying the allegations, and pay a $5 million penalty.
New York Attorney General Andrew Cuomo also announced the state has reached a settlement with Quadrangle for $7 million (see Cuomo Garners Five Pension Probe Settlements).
The SEC’s announcement is here.