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Aldus Equity

Marc Correra: The Link Between New York's Pension Scandal And "Toxic Waste" In New Mexico?

Moe Tkacik | May 1, 2009, 4:59PM

Three weeks ago we told you about accusations that the New Mexico State Investment Council had been under political pressure to invest teachers' retirement funds in risky investments like a $90 million "toxic waste" CDO backed by subprime mortgages -- and wondered if any of the other intensifying corruption investigations across the country might involve some of the same pay-for-players.

Sure enough, a few names emerged last week to link the New Mexico pension fund scandal to the alleged conspiracy to defraud the New York general pension fund under investigation by the state attorney general's office. One was Obama car czar Steve Rattner, who paid alleged ringleader Hank Morris more than a million dollars for securing investments in both states' pension funds. Morris was indicted in March for collecting $30 million in fraudulent "finder's fees" as a top adviser to the former state comptroller Alan Hevesi, in collusion with the pension fund's manager David Loglisci. But the indictment didn't address Morris's "placement" services in other states; his name turned up on a list of placement agents released by the New Mexico State Investment Council as the broker of a $20 million investment in Rattner's private equity firm Quadrangle.

The other thread running through both the New York and New Mexico pension funds was the advisory firm Aldus Equity, whose founder Saul Meyer was charged yesterday with participating in the New York conspiracy and which also until this week advised similar investments in New Mexico.

The further we looked, the wider and farther-back the suspicions of public pension fund pay-to-play seemed to extend, as Cuomo noted himself at yesterday's press conference:

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Topics: Aldus Equity, Bill Richardson, Dan Weinstein, Jerry Cremins, Marc Correra, pension scandals

Andrew Cuomo

Cuomo Charges Dallas Money Manager, Says NY Pension Scammers Are Part Of A "National Network"

Moe Tkacik | April 30, 2009, 4:00PM

New York AG Andrew Cuomo added a new name to the growing list of indictments in the New York Pension Fund scandal: Saul Meyer, the (youthful-looking) 38-year-old founder of the private equity fund Aldus Equity. Meyer won't be the last, Cuomo assured reporters at a press conference announcing the charges today:

"I believe we are disclosing a national network of actors who often acted in concert and did this all across the country," Mr. Cuomo said. "They collaborated, they often partnered and victimized states and taxpayers across the country. It's also an ongoing scam."

We said as much yesterday, when we showed you how a key figure in the pension scandals in New Mexico and New York was a direct descendant-in-law of a key figure in a California pension scam of the nineties. And we told you about Aldus, a key name linking the New York fraud to a suspected scheme to scam the teachers' retirement fund in New Mexico and possibly other public pension funds, last week.

Aldus's usual business was advising state pension funds on private equity investments. But it went a step further in New York, using its access to the pension's billions to arrange a $375 million investment to create its own private equity fund. The idea was hatched by Hank Morris, the top adviser to former state comptroller Alan Hevesi who is charged with defrauding the pension fund in a scheme to collect phony "finder's fees." According to the indictment, Aldus paid Morris about $320,000 to secure itself a $375 million investment from the pension fund. Not bad for a private equity firm that, according to this Dallas Business Journal puff profile that ran (all of) two months ago: "started in 2003 with no clients."