Former New York Comptroller Alan Hevesi pleaded guilty to a felony on Thursday in a pay-to-play kickback scheme. Hevesi admitted to accepting nearly $1 million in benefits in exchange for approving $250 million of pension fund investments.
Hevesi faces up to four years in prison for a felony count of receiving rewards for official misconduct. He served as state comptroller from 2003 to 2006, stepping down after pleading guilty of defrauding the government for using a state-employed driver for his personal use.
Hevesi admitted that he accepted nearly $1 million in gifts from Elliott Broidy, a principal of Markstone Capital Partners LP, in return for approving a $250 million investment in the firm from the state pension fund. Those gifts included travel expenses, a sham consulting agreement with a friend of a political adviser, and campaign contributions.
"I knowingly accepted and agreed to accept benefits from Broidy for having improperly favored Markstone for New York State Common Retirement Fund investments, in violation of my fiduciary and other duties as a state public official and the sole trustee of the New York State Common Retirement Fund," Hevesi said in his allocution.
The guilty plea is the seventh in an ongoing three-year investigation by state Attorney General Andrew Cuomo. Broidy last year pleaded guilty to a felony charge of rewarding official misconduct.
"Alan Hevesi presided over a culture of corruption and violated his oath as a public servant," Cuomo said in a press release. "He was solely charged with protecting our pension fund, but he exploited it for his personal benefit instead."
Hevesi also admitted that he knew his political adviser and campaign manager Henry "Hank" Morris was also involved in a pay-to-play pension fund scheme. Morris has pleaded not guilty and faces trial for allegedly accepting kickbacks from the New York- and Hong Kong-based Quadrangle Group in return for increasing pension fund investments in the firm. Earlier this year Quadrangle agreed to pay the state $7 million in a settlement with the attorney general's office.