Random NY Kickback Scandal Ramblings
Here's a handful of additional notes on the NY State Common Retirement Fund situation and, in particular, yesterday's decision by Comptroller DiNapoli to ban the future use of placement agents by firms requesting NYSCRF investments (find my initial take here): *** I want to stress that I am in no way attacking the integrity of the current NYSCRF private equity staff, whose morale right now must be lower than that of Montreal Canadiens fans (happy 100 years). In fact, I have to wonder if the lid would have been blown off this scandal earlier, if New York had some sort of whistleblower shield to protect them from ratting out their bosses. Kind of reminds me of the Ohio BWC situation, where good staffers got caught up in something not of their own doing. *** The ban extends beyond placement agents, but a NYSCRF spokesman says that it will not extend to things such as the use of a third-party data room or printing company. I'm supposed to be emailed the official guidelines later today, and will post them. From what I can tell, they are not yet on the NYSCRF website. *** If you are a PE firm that used a placement agent, but are already in the midst of being diligenced by NYSCF, you're okay (seems the ban comes with a grandfather clause). *** DiNapoli has hired outside consultants to review current policies and relationships, but the placement agent ban is not up for discussion.
