Cuomo's Probe: Obama's Former Car Czar Settles and Apologizes

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Steven Rattner, President Obama's car czar, agreed to pay $10 million in fines along with a five-year ban from working with pension funds in New York State as part of a pay-to-play investigation launched by Attorney General and governor-elect Andrew Cuomo.

It's the final piece of a year long investigation Cuomo says has recovered $170 million for the state, and introduced tougher rules for who can invest the state's money.

In his settlement with Cuomo, Rattner did not admit to wrongdoing but did apologize "if during the course of this process there is anything I did that may have made reaching this agreement more difficult."

Reaching the settlement with Rattner hasn't been easy.

Defenders of Rattner, like former newspaper editor Ira Stoll, said investments Rattner made on behalf of the pension fund made adequate returns. Stoll also said Rattner did provide information to Cuomo's investigators on four occasions. Mayor Bloomberg also stood by Rattner, saying he would maintain his relationship with the the financial advisor.

But not everyone has. Colleagues at the hedge fund founded by Rattner settled with Cuomo, and on November 18 said Rattner, at the time, was "failing to take responsibility for his actions." In a November 23 television interview, Rattner said Cuomo's pursuit of influence-peddling charges against him were "close to extortion."

Initially, Cuomo sought $26 million in fines from Rattner and charged that the hedge fund manager had "lied" to investigators from his office.

After delivering turkeys and food to a shelter near Canal Street last month, Cuomo said Rattner was a thief.

At the end of the day, Mr. Rattner's behavior, I believe, was truly an egregious example of basically stealing taxpayer's money. Remember, this is a man who took $200 million in pension funds to invest. This is a man who employed Hank Morris, who has already pled guilty. This is a man who gave a gift, indirectly, to the state official who was making the decisions. This is a man who refused to answer questions before my office. So, when the facts are all out, i think the people will know very well what Mr. Rattner has done.

Cuomo went on to say he rejected a $6 million deal Rattner reached with the Securities and Exchange Commission because the seven-figure fine didn't go far enough. "I rejected that settlement. $6 million is about the amount of money Mr. Rattner will make from the deal. So, basically, the settlement with the SEC was give back the money and you can go on your way. That is not justice. I've done many, many cases - we have people in prisons today who would have gladly given back the money and go on their way. That's not doing justice and that's why I rejected that settlement."

Rattner was a financial advisor and major donor to Democrats across the country. In February 2009, Rattner was tapped to help turn around the country's flailing auto industry. He recently published a book, Overhaul, detailing his work in that field.