Peggy Lipton, The Girlfriend Who Sparked the Pension Scandal

How a Queens schlub went head over heels for Peggy Lipton and brought down the system

Chartier's own exciting chapter closed out at the end of 2004 when Lipton returned to California. The thrill was long gone two years later when Albany D.A. David Soares launched a probe into Hevesi's own misuse of state drivers who had been assigned to handle personal chores for the comptroller's ailing wife, a petty scandal that forced Hevesi from office as he pled guilty to abusing state property.

News also surfaced of Chartier's liaison in the back seat of a state automobile. The comptroller's former top aide ducked reporters' queries—then as now. But faced with prosecution for his own indiscretions, at some point Chartier saw the light and began talking to investigators. These now included dogged representatives of Cuomo, the newly elected attorney general. Chartier, it quickly emerged, had a lot more to tell than just using a state car and driver for personal affairs.

For starters, there was a tangle of multimillion-dollar pension investment schemes allegedly cooked up by Morris and the fund's chief investment officer. There was also a $100,000 loan for Lipton that Chartier and Morris allegedly coaxed out of a California-based investment firm, the Markstone Capital Group, which was seeking to land a $250 million deal with the pension office. There were cash payments allegedly provided by Morris for Lipton's luxury East Side rent, in exchange for Chartier's assistance with his burgeoning securities business. Someone helped Lipton's daughter get a job.

And then, as Chartier had complained to friends at the time, there was the story of what a bad sport Stein had been after Morris began elbowing Stein aside and taking over his pension fund customers. After the man-about-town's own deals failed to get done at the pension fund, he allegedly barraged both Chartier and Lipton with angry phone calls.

Stein declined to discuss these matters. "I'm on a conference call," he said Friday. "Call me back in 20 minutes." But callbacks reached only an answering machine. In fairness, the entire subject may be a sore spot. Despite all the Page Six mentions, and the helpful friend to whom he introduced her, there is not an Andrew nor an Andy singled out for thanks on the acknowledgments page of Lipton's memoir.

trobbins@villagevoice.com

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