Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Former auto czar pays $10 million fine

By David Goldman, staff writer


NEW YORK (CNNMoney.com) -- Quadrangle investment group founding partner and former Obama "auto czar" Steven Rattner agreed Thursday to pay a $10 million fine in a settlement with the New York attorney general's office over a pension fund scheme.

Rattner was accused of a "pay-to-play" scheme involving New York's pension fund, in which Rattner's Quadrangle allegedly gave kickbacks to officials if they directed state pension money to the fund.

steve_rattner__091020.03.jpg
Steven Rattner, founding partner of Quadrangle and former Obama administration 'auto czar' settled a pension fund scheme allegation for $10 million.

In addition to the fine, Rattner was also banned from appearing before any public pension fund within New York for five years.

"I am pleased to have reached a settlement with the New York Attorney General's Office, which allows me to put this matter behind me," said Rattner in a statement. "I respect the work of the Attorney General and his staff to ensure that the New York State Common Retirement Fund operates properly and in the best interests of New Yorkers."

The investigation has led to eight guilty pleas, including one by former state comptroller Alan Hevesi.

"The state pension fund is a valuable asset held in trust for retirees and supported by taxpayers," said New York Attorney General Andrew Cuomo, in a prepared statement. "I believe we have been able to help restore and protect the integrity of the state pension fund."

In April, Quadrangle agreed to pay a total of $12 million to settle charges by the SEC and the New York State Attorney General over the pension fund scheme case. Rattner, who no longer works at Quadrangle, was not part of that settlement.

Rattner left Quadrangle early last year when he was tapped by Obama to help oversee the restructuring of the auto industry in the wake of the financial crisis. His tenure as head of the government's auto task force was brief.

Rattner stepped down from the position in July of last year amid talk of his involvement in the pension fund scheme.

The settlement came just two days before Cuomo will be sworn in as New York's governor. To top of page

Index Last Change % Change
Dow 16,204.97 -211.61 -1.29%
Nasdaq 4,363.14 -146.41 -3.25%
S&P 500 1,880.05 -35.40 -1.85%
Treasuries 1.85 -0.02 -0.86%
Data as of 5:45pm ET
Company Price Change % Change
Bank of America Corp... 12.95 -0.30 -2.26%
Facebook Inc 104.07 -6.42 -5.81%
Freeport-McMoRan Inc... 5.68 -0.04 -0.70%
Microsoft Corp 50.16 -1.84 -3.54%
General Electric Co 28.54 -0.64 -2.19%
Data as of Feb 5
Sponsors

Sections

The economy is better than it was, but not even President Obama is ready to declare it's booming. More

Laurie Segall sits down with Foursquare's new CEO Jeff Glueck to discuss the company's latest round of funding at a lower valuation, and their hybrid consumer/enterprise business model. More

Nonprofit JumpStart has launched a new $10M fund that will only invest in women and minority-led startups. The catch: You have to move to Ohio. More

Portland, Oregon, is often described as the last affordable cool city on the West Coast. But as more people move to the city, it's becoming increasingly unaffordable. More