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Venture Capitalist Charged in Pay-to-Play Penion Probe

Thursday, December 03, 2009

A California venture capitalist has pleaded guilty to criminal charges in connection with New York Attorney General Andrew Cuomo's investigation of a pay-to-play scandal at the state's giant public pension fund.

Elliott Broidy, chairman of Markstone Capital Partners entered the plea this morning. He admitted to a felony charge of rewarding official misconduct.

Prosecutors say he made gifts of nearly $1 million in exchange for a $250 million

An investment manager has pleaded guilty to bribing New York state pension fund officials. It's the fifth conviction in Attorney General Andrew Cuomo's ongoing investigation of a pay-to-play scheme at the pension fund.

Markstone Capital Partners Chairman Elliott Broidy admitted to a felony charge of "rewarding official misconduct" and is now cooperating with prosecutors. Cuomo says Broidy made gifts of nearly $1 million to four state workers, in exchange for a $250 million pension fund investment in his private equity firm.

"Mr. Broidy paid luxury travel to Israel and Italy, hotels, flights, helicopter tours, for a senior comptroller official and his relatives," Cuomo says. Cuomo says Broidy also paid $300,000 to help finance a side movie project of the pension fund's former chief investment officer, David Loglisci, who faces several criminal charges. Cuomo wouldn't name the other three state employees who received payments, since they're not charged with a crime. Cuomo says the payments show the depth of corruption at the pension fund. Broidy faces up to four years in prison.

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