No Placement Agents in Pension Deals

Submitted by Melissa Hoffmann on Wed, 04/22/2009 - 14:42

State Comptroller Thomas P. DiNapoli has banned the involvement of placement agents in investments with the New York State Common Retirement Fund.

The ban includes paid intermediaries and registered lobbyists “compensated on a flat fee, a contingent fee or any other basis.”

DiNapoli, who is running for re-election in 2010, said the ban is meant to restore confidence in the office and its handling of the pension fund, noting that "the Hevesi administration violated the public trust."

DiNapoli said he was drafting legislation to codify the pension fund reforms he has made since taking office in 2007, eliminating the potential for abuse in the future. In addition, DiNapoli asked the state's insurance superintendent to codify the ban into the regs.

Earlier this month, it was reported that The Carlyle Group was among several investment companies being investigated for using placement agents, what the New York Times called "a widespread practice" among hedge funds and private equity firms.

Attorney General Andrew M. Cuomo's pension fund probe is continuing: stay tuned.

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