Bloomberg Adviser and Financier Steven Rattner Settles With S.E.C.

The scandals keep coming for the people around Mayor Moneybags:

Steven Rattner, the former car czar, has agreed to a settlement with the Securities and Exchange Commission over kickback claims involving the New York State pension fund, a person with knowledge of the negotiation said Wednesday.

Mr. Rattner will accept a multiyear ban from the securities industry and pay a fine of more than $5 million, the person said. He is still in negotiations over a similar settlement with the office of the New York attorney general, Andrew M. Cuomo.

The settlement, which is expected to be announced on Thursday, caps a multiyear investigation by the government into kickbacks paid to officials with New York’s pension fund. Earlier this month, Alan G. Hevesi, the state’s former comptroller, pleaded guilty to a corruption charge involving the state fund.

The Quadrangle Group, the private equity firm co-founded by Mr. Rattner, settled with the S.E.C. and Mr. Cuomo’s office in the spring and disavowed Mr. Rattner’s conduct in a statement. The firm agreed to pay $7 million to the pension fund and $5 million to the Securities and Exchange Commission.

Mr. Rattner refused a similar offer to settle with the S.E.C. last spring, because he did not want to accept the ban from the industry. Quadrangle had been cooperating in the government’s investigation of Mr. Rattner. Since leaving his post with the Obama administration’s auto task force over a year ago, Mr. Rattner has been advising Mayor Michael R. Bloomberg of New York on his personal finances and writing a book about his tenure as car czar.

Rattner is more than just an adviser to Bloomberg.

Here is the NY Times in April on the role Rattner plays in Bloomberg's life:

Steven L. Rattner, the financier under increasing scrutiny in a state and federal kickbacks investigation, is playing a key role in creating a new investment firm that will manage Mayor Michael R. Bloomberg’s fortune and finance his philanthropic foundation, according to three people told of the arrangement.

At Mr. Bloomberg’s urging, Mr. Rattner has taken a hands-on approach in helping to build the new company, despite his legal problems, these people said, speaking on condition of anonymity for fear of angering the mayor and Mr. Rattner.

The move comes at a time when others, including the investment firm he founded, are taking pains to distance themselves from Mr. Rattner.

...

The move comes at a time when others, including the investment firm he founded, are taking pains to distance themselves from Mr. Rattner.

Attorney General Andrew M. Cuomo has accused Mr. Rattner of paying kickbacks to an aide to former State Comptroller Alan G. Hevesi in exchange for the aide’s help in landing a state investment contract for Quadrangle, the private equity firm that Mr. Rattner founded and ran for years.

Mr. Rattner has since left Quadrangle, but last week, the firm paid $12 million to settle allegations in the kickback case and, in unusually harsh language, it rebuked Mr. Rattner for his role, calling it “inappropriate, wrong and unethical.” Mr. Rattner’s lawyers vigorously denied those claims.

Mr. Rattner, according to the three people, has told friends that he is “working with the mayor,” and he has repeatedly appeared at the 78th Street office that houses the Bloomberg Family Foundation and the mayor’s new investment office. A spokesman for Mr. Bloomberg, Stu Loeser, declined to comment on the details of Mr. Rattner’s work with Mr. Bloomberg, but said, “He is a friend whose advice the mayor has and continues to rely on.”

Kickbacks, bribes, unethical behavior.

Yet still the mayor remains close to Rattner and take his advice.

Oh, goodie.

Looks like you have to be a teacher to earn the mayor's rebuke.

But kickbacks, bribery, unethical behavior - no problem for Moneybags...so long as you're a bankster.

Mayor Moneybags Prepares To Run For President

Mayor Moneybags is worth about $15 billion dollars.

He had a third of that fortune invested in his pal Steven Rattner's crooked private equity fund known as Quadrangle Asset Management.

Now he's moving it:

Mayor Michael R. Bloomberg of New York has decided to remove his fortune from a private equity firm founded by his longtime friend, 10 months after that firm became embroiled in a scandal involving the state pension fund.

The mayor is shifting about $5 billion from Quadrangle into a new investment firm devoted solely to his interest and that of his charitable foundation. About a dozen employees of Quadrangle will join the new enterprise, suggesting the move is not being driven by a desire to change investment strategy. According to a letter that Quadrangle sent to its investors on Friday, the mayor was seeking privacy and flexibility for his investments.

In assets, Quadrangle will shrink by more than half, leaving the firm only private equity investments in the media and telecommunications industries. The setback caps a year of struggle for Quadrangle, after Steven Rattner — the founder who is Mr. Bloomberg’s friend — departed last year to run the Obama administration’s automobile task force. Mr. Rattner was linked to the New York pension fund investigation within months of that appointment and stepped down from his government role last summer.

No charges have been brought against the firm or Mr. Rattner by the attorney general of New York or the Securities and Exchange Commission, which are both investigating Quadrangle’s past dealings with the New York state pension fund.

The Times speculates that Bloomberg is moving the money so that he can use it in 2012, when he may run for president and drop more than $1 billion of his own money on the race.

Leaving aside whether people who were in charge of Bloomberg's money were involved in the pension scandal, I think the important part of the story is that Bloomberg is running for president in 2012.

You can see how he's setting it all up.

He and Obama were once buddies - now he's been criticizing him over the terrorist trials to be held in NYC, over his bank plan, and over the health care reform business.

He's got his buddies in the press writing lots of stories or talking on the TV about Washington gridlock and partisanship that has government paralyzed (the latest was Bobo Brooks on Meet The Press last week saying he know sees a third party candidate as a viable option in 2012 because the two party system is so dysfunctional.)

He hired Howard Wolfson, former p.r. hack for Hillary Clinton in the '08 race, after he won re-election for a third term as mayor. Wolfson wasn't brought in to jive the press about what the mayor is currently doing at City Hall. Wolfson was brought in to jive the press about what the wonderful non-partisan technocrat Bloomberg can do to solve Washington partisan gridlock.

And now he's moving his money from his crooked pal Rattner's fund so that he can use it for the 2012 run.

The scary thing is, with the Supreme Court allowing corporations to spend as freely as they want on elections (and presumably they just might want to drop lots of money to elect quite literally one of their own) and with Bloomberg's willingness to drop over a billion on this race, it is just possible he could win.

Not likely, of course. But when you're talking that kind of money being leveraged to buy the White House, who the hell knows what'll happen.