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D.C.'s Carlyle Group To Pay $20 Million In N.Y. 'Pay To Play' Settlement

Carlyle Group, the Washington D.C.-based private equity group founded by former Carter White House official David Rubenstein, has agreed today to pay $20 million to settle its role in a "pay to play" investigation brought by New York Attorney General Andrew Cuomo involving the state pension fund.

Hank Morris, a political consultant to New York Comptroller Alan Hevesi, was indicted in March along with the state pension fund's chief investment officer on charges they ran a shake-down operation, demanding big kickbacks from firms that wanted access to the pension investment funds.

Carlyle paid $13 million to Morris and eventually received a $730 million investment from the pension fund.

Though Carlyle faced no charges, it has agreed to pay the settlement and change certain of its policies to resolve its role, Cuomo's office said.

Under the settlement, Carlyle agreed to abide by Cuomo's "pension fund code of conduct," which, among other provisions, bans investment fund employees from making political contributions to candidates who influence pension fund decisions.

You can read Cuomo's entire release here.

-- Frank Ahrens
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By Frank Ahrens  |  May 14, 2009; 2:52 PM ET
Categories:  The Ticker  | Tags: Andrew Cuomo, Carlyle Group, David Rubenstein  
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