Steve Rattner's E-mails Told a Different Tale on Movie Deal

The Times gives the Steve Rattner case Page One treatment again today. But this one's a little different from the last time when the former Timesman, who counts both Times publisher Arthur Sulzberger and Mike Bloomberg as close friends and clients, was described as putting his legal troubles behind him.

Today's story is a tick-tock of the Rattner investigation which grew out of the mammoth scandal at the state pension fund unearthed by Andrew Cuomo's investigators. And while the headline -- "How Cuomo Investigation Escalated Into a Nasty Feud with a Financier" -- suggests it's just two alpha dogs barking at each other, the story itself shows how Rattner misled investigators about his own involvement in the influence peddling schemes.

The quotes from the governor-in-waiting pull no punches:

"He lied," Mr. Cuomo said in an extensive interview with the Times. "The word is 'lied.'"

Reporters Louise Story and Michael Barbaro managed to obtain notes compiled by Rattner's former lawyers -- who are also now entangled in the case. They also have e-mails that Rattner sent to business associates, including Hank Morris, the political guru to ex-state comptroller Alan Hevesi, both of whom have pled guilty to their own role in the shakedowns.

In his first sit-down with investigators, the Times says, Rattner assured them that his decision to have one of his companies handle the distribution "Chooch" -- a minor farce movie made by the brothers of Hevesi's former investment chief -- was unrelated to his efforts to win business from the pension fund. According to the notes, Rattner told investigators at a September 20, 2007, sit-down that the investment was "commercially reasonable" -- i.e. not a favor to the investment chief, David Loglisci (who pled guilty to his own role earlier this year).

Rattner also explained an e-mail he'd sent to Morris about the movie deal as solely intended to keep Morris from being "surprised" about the deal.

But e-mails that surfaced later showed that Rattner was told by the chief executives of his Good Times Entertainment company, which bought the "Chooch" rights, that she "was inclined to 'take a pass'" on the movie.

Rattner wrote back, urging his exec to "dance along" with the idea. Another e-mail shows that Loglisci's brother received "a favorable discount" on the arrangement. Yet other e-mails confirm that Morris knew about the arrangement long before Rattner claimed to have informed him that he was buying the distribution rights.

Rattner has already agreed to settle charges brought against him by the Securities Exchange Commission by paying $6 million and taking a two-year ban from market trading. Cuomo rightfully thinks that's getting off too easy and filed his own lawsuits against Rattner right before Thanksgiving demanding $26 million in fines and a lifetime ban from securities trading.

All of this is only fitting. The scandal that started when an aging Queens political hack tried to impress a faded TV starlet now gets a second life thanks to a fixed deal to promote a B-movie.


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