Rattner, Obama's Auto Chief, Caught Up in Kickbacks Probe

Source says Rattner linked to pension fund pay-for-play deal
By Rob Quinn,  Newser Staff
Posted Apr 17, 2009 5:52 AM CDT
Rattner, Obama's Auto Chief, Caught Up in Kickbacks Probe
Steven Rattner, seen here in a 2006 file photo, is involved in an SEC probe of improper payments in exchange for investments from New York's pension fund.   (Getty Images)

Steven Rattner, the head of President Obama's auto task force, is involved in an SEC probe of a kickback scandal involving New York state's pension fund, a source tells the Wall Street Journal. Rattner is not accused of any wrongdoing, but is believed to have directed a $1.1 million payment from his private equity firm Quadrangle to an intermediary who steered an investment of $100 million from the fund Quadrangle's way.

The SEC alleges that a Quadrangle executive—who the source says was Rattner—also arranged for the firm to invest $90,000 in Chooch, a low budget-film being made by the deupty comptroller's brother-in-law, shortly before Quadrangle received the pension investment and paid the "finder's fee."  Both the comptroller, Alan Hevesi, and his producer-brother-in-law have been indicted for bribery and money laundering. A Treasury spokeswoman said Rattner had informed them of the ongoing probe during the transition period.
(Read more Steven Rattner stories.)

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