A private equity group and one of its founders have been charged with paying massive kickbacks in exchange for access to the New York State pension fund. WNYC's Ilya Marritz has more.

REPORTER: The Securities and Exchange Commission and New York Attorney General Andrew Cuomo allege that in 2004, the Dallas-based Aldus Equity Group paid more than $300,000 to a shell company operated by Hank Morris. Morris is a placement agent, or middleman, who's already been indicted. In return for the alleged kickback, prosecutors say Aldus was given $375 million of pension money to manage.

Aldus co-founder Saul Meyer turned himself in to authorities in Manhattan, and was released on $200,000 bail. A lawyer for Aldus Equity called the investigation "trial by news release".

State Comptroller Tom DiNapoli announced he's severing the pension fund's relationship with Aldus, effective immediately. New York City Comptroller Bill Thompson says he's asking the boards of the five city pension funds to also end all business with Aldus Equity. For WNYC, I'm Ilya Marritz.