A manager of an $800 million California-based private equity firm has admitted to paying almost a million dollars in bribes to four high-ranking officials in the New York State pension fund between 2002 and 2006, Attorney General Andrew Cuomo announced today.
In exchange for these bribes, Elliott Broidy (pictured), founder of Markstone Capital Group, was able to secure a quarter of a billion dollars in investments from the pension fund, as well as $18 million dollars in management fees.
The state officials, whom Cuomo did not name, used the bribe money to pay for rents and living expenses for the officials and their family members, including $300,000 for Chooch, a low-budget comedy produced by brothers of David Loglisci, the chief investment officer under former Comptroller Alan Hevesi who was indicted last month on corruption charges…
Hevesi resigned in 2006 after pleading guilty to defrauding the government, including using a state worker to chauffeur his sick wife. (Of course, as Tom Robbins points out in his column this week, this was small potatoes compared to the junkets former State Senator Joe Bruno arranged for himself.)
Broidy paid $90,000 dollars in hospital bills for a girlfriend of one of the officials, and $44,000 in monthly payments were given to one of her relatives. According to a press release, these payments were concealed through a sham loan agreement between Broidy and the relative. Hundreds of thousands were put toward a sham consulting company run by another family member.
Broidy, who was referred to in an article in The Jewish Journal as “Israel’s mystery benefactor,” traveled to Israel with a high-ranking official from the Comptroller’s Office at least five times, and went once to Italy.
Cuomo was careful to point out that today’s guilty plea involved old-fashioned — although very lucrative — kickbacks, and was not related to the investigations into placement agents, which he said are ongoing.
Markstone Group continues to manage investments for the state of New York.