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Posted at 11:01 AM ET, 11/18/2010

NY attorney general Cuomo sues Rattner, chief architect of auto bailouts

By Jia Lynn Yang

rattner.JPG

(Photo Credit: AP Photo/The Detroit News, David Guralnick)

The attorney general of New York, Andrew Cuomo, hit Steve Rattner with two lawsuits Thursday, alleging that Rattner paid kickbacks to win $150 million in business from the state's pension fund for his private equity firm.

Meanwhile, Rattner has agreed to a $6.2 million settlement with the Securities and Exchange Commission over similar allegations of widespread fraud at Rattner's firm, Quadrangle.

It's a bizarre confluence of events for Rattner, the chief architect of the government's auto bailouts, who was poised for a victory lap today as General Motors returns to the stock market in a remarkable turnaround.

Instead, Rattner faces a pair of suits seeking at least $26 million in penalties and an immediate lifetime ban from the securities industry in New York.

"Steve Rattner was willing to do whatever it took to get his hands on pension fund money, including paying kickbacks, orchestrating a movie deal and funneling campaign contributions," Cuomo said in a statement. "Through these lawsuits, we will recover his ill-gotten gains and hold Rattner accountable."

According to Cuomo, Rattner tried to influence officials at the Office of the State Comptroller with a series of kickbacks. These included more than $1 million in "sham placement fees" paid to Henry "Hank" Morris, political adviser to the state comptroller at the time, Alan Hevesi.

Rattner also allegedly set up a DVD distribution deal for a movie named "Chooch" produced by the state retirement fund's chief investment officer and his brothers.

Rattner was appointed head of President Obama's Auto Task Force in February 2009, helping to craft the federal bailout of carmakers General Motors and Chrysler. That April, Cuomo and the SEC began investigating Rattner's involvement in the pension fund. Rattner left the administration three months later.

Read a copy of the summons and complaint from Cuomo here.

By Jia Lynn Yang  | November 18, 2010; 11:01 AM ET
Categories:  SEC  
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Comments

Sounds similar to the Jack Johnson's case. According to the info on toyota runaway org Jack is subject to become a Slave under the constitution if convicted. This gentleman has avoided becoming a Slave by paying a hefty fine. Humm, maybe Jack charges are criminal while Rattner's charges are civil. This toyotarunaway org site has a point with thier explanation of the Haves and Have Nots.

Posted by: Moley2 | November 18, 2010 11:26 AM | Report abuse

Texas republican Rep. Joe Barton apologizes to Rattner.

Posted by: knjincvc | November 18, 2010 12:25 PM | Report abuse

This is the guy who Obama hired to do the auto bailout. Small world, isn't it?
We need Cuomo, Issa and about a thousand others to keep up with this.....

Posted by: ohioan | November 18, 2010 1:23 PM | Report abuse


CONGRATULATIONS to Jia Lynn Yang on the kind of excellent journalism we are coming to expect.

Give me a brief run down on the story, yes ... but provide me with a link to the original charging documents ... this substantiates the story NO END.

BRAVO Jia Lynn Yang

Posted by: Anonymous | November 18, 2010 2:56 PM | Report abuse

another corrupt dem czar.

shocked. obama says..... nothing.

Posted by: docwhocuts | November 18, 2010 3:09 PM | Report abuse

How much did this thug steal and how nuch of our money will Cuomo get back, Here again is a theif that will probably go to a upCake jail (if any) Certainly would be interesting , if nothing else, to find out what the outcome in dollars will be, and what the penalty will or will not be.

By the by, Rangel sure Do hAVE A SHORT MEMORY IF FOR 17 YEARS HE CANNOT REMEMBER PAYING TAX TO THE GOVERNMENT, BUT HE LOOKS GOOD AND MUST EAT WELL!

Posted by: LOONYBIN2000 | November 18, 2010 3:12 PM | Report abuse

Not only did he rip off the taxpayers of New York, he also failed to tip me on any of the occasions that I drove him or his wife around Washington DC in my limousine.

Posted by: Anonymous | November 18, 2010 3:29 PM | Report abuse

Once again I can't take the WaPo seriously serious when they use the word "czar". Czar - Emperor or king. Autocratic ruler or leader. Ruler of Russia; etc.

Posted by: rlj1 | November 18, 2010 4:14 PM | Report abuse

Change we can believe in? HAHAHAHAHAHA!

Posted by: dbeins | November 18, 2010 4:59 PM | Report abuse

I'd like to see the movie "Chooch."

Posted by: Anonymous | November 18, 2010 5:13 PM | Report abuse

"Once again I can't take the WaPo seriously serious when they use the word "czar".

The story didn't use the word "czar", and reporters seldom have input on headlines. Note, however, that it's headline language, in this case in the very small e-version area available for headlines or story information. Unfortunately, the word "czar" is a word used by government officials of all parties, as well as the media and the general public. It's strictly shorthand language which would be better off unused, space permitting.

Posted by: Anonymous | November 18, 2010 6:19 PM | Report abuse

All of the charm and bull in the world cannot cover this terrible administrations lack of ethics and integrity. One piece of work after another. I hope the people that raised him are proud.

Posted by: Anonymous | November 18, 2010 7:54 PM | Report abuse


Google in the input: = aamall.us = you can find many brand names, even more surprising is that he will sell you the unexpected o(∩_∩)

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Posted by: abulaw | November 18, 2010 10:23 PM | Report abuse

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