City Comptroller Bill Thompson yesterday launched a probe into a private-equity firm after he was stung by revelations that an accused pay-for-play political consultant earned fees off deals with the city’s pension fund.
Thompson said he had no clue that indicted power broker Hank Morris received a “placement fee” for an $85 million deal with the city’s pension fund, which was reported in late editions of yesterday’s Post.
It was the first time that Morris — who has been charged with taking kickbacks from firms looking to get into the state pension fund — had been linked to deals with the city’s retirement system.
Presumed mayoral candidate Thompson said the Quadrangle Group — the equity fund created by President Obama appointee Steven Rattner — never revealed it paid a fee to the indicted Morris’ firm, Searle & Co, a Thompson spokesman said yesterday.
“We are investigating whether the New York City pension funds and Comptroller’s Office were intentionally misled or deceived as to the identities of all placement agents used by Quadrangle,” Thompson spokesman Jeff Simmons said in an e-mail to The Post.
The city pension funds — which Thompson controls — invested $85 million in Quadrangle in 2005 and $40 million in 2006, Simmons said.
“At no time did the pension funds’ consultant ever identify Morris or Searle as a placement agent,” according to the e-mail.
At the time, companies looking to get an investment from the New York City Employees Retirement System were not required to tell city officials if they paid a placement fee. The disclosure rule came into effect in 2007.
But a pension-fund consultant handling Quadrangle specifically asked the company in a 2004 questionnaire whether they’d used placement agents.
Quadrangle said it used two firms — Monument Group in Boston and Helix Associates in London, a Thompson spokesman said.
When asked about the discrepancy, a Quadrangle spokesman said, “This came as a complete surprise. We plan to gather all the facts and intend to clear up the issue as soon as possible.”
Last month, Morris, a close adviser to former state and city Comptroller Alan Hevesi, was slapped with a 123-count indictment on fraud and other charges.
Rattner — who founded Quadrangle but left to head Obama’s auto-bailout task force — was identified as an executive who met with Morris in an effort to secure a deal with the state pension fund.
Rattner — who used to manage Mayor Bloomberg’s investments — has not been charged with a crime and Obama is standing by him.
The mayor yesterday said, “I don’t know if there’s an oversight failure. It’s up to the pension.”
Former pension-fund manager David Loglisci and ex-Liberal Party leader Ray Harding were also bagged in that state scheme.